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steve71489
10-25-2016, 09:16 AM
So I know pretty much all small business owners tack personal expenses onto their business when reasonable to do so.

My question is what is the best way to do this while still being able to keep a clear picture of what the business is actually making, as opposed to what it seems to be making after your personal expenses are deducted?

Is keeping 2 sets of books the only way?

RizAseem
11-02-2016, 05:52 PM
Hi Steve,

Here's how to track your personal and business expenses separately -- even when you charge them to your business.

For all actual business expenses -- use a business card and bank account.
For all personal expenses you charge to the business -- use your personal bank card and bank account.

Then to charge the 'personal' expenses to your business -- you expense them in the business as a 'loan from owner' to the business. This way at the end of the year you will know the personal expenses you charged to the business by looking at the 'loan from owner' account. Plus you will also have charged all your expenses to the business.

joedomains
11-03-2016, 09:24 PM
one way i have used is to use 2 different categories during the year, like office expenses and office supplies, with one being more of the hybrid deductions.

but i would combine at the end of the year other wise under audit you have put all the semi deductible eggs in one basket.

it is important ot back out these owner expenses when preparing the company for sale

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domnick
12-16-2016, 12:55 AM
It's not an easy quest to answer, because this is somewhat difficult to expose the solution. But I'm using accounting tool Apptivo for managing both my personal and business accounts. It contains some interesting things for maintaining business accounts, I customized it based on my business needs and personal use. Few instances, list out all my expenses in appropriate names, keep all financial transactions, generate invoices/billing for my customers as per service offered or my choice, etc. After I jump up into this tool, my entire accounts maintain properly.

BusinessFundingPro
04-03-2017, 11:07 AM
The easiest way is to transfer money from your business account into a personal account. Plus, it also makes it easier for underwriters when applying for a loan to understand what expenses your business has :)

TienAd
04-15-2017, 07:43 AM
list out all my expenses in appropriate names, keep all financial transactions, generate invoices/billing for my customers as per service offered or my choice, etc.

ireneqsi
04-15-2017, 10:46 AM
Yeah, I am using accounting tool Apptivo for managing both my personal and business accounts.

Chris_Tax
04-16-2017, 01:14 AM
It need to be used for business. You can allocate the amount of the expense is used for Business and personal. This amount world be a business expense

amaxwell
04-16-2017, 01:30 PM
Hello
Ankit ,
I agree with you, It is important to use a different bank account for business and personal expenses to know actual amount utilize for business.
Thanks!!

amaxwell
04-16-2017, 01:31 PM
Hello
I agree with you, It is important to use a different bank account for business and personal expenses to know actual amount utilize for business.
Thanks!!

asiateloutsourcing
05-01-2017, 05:26 AM
I agree with you, It is important to use a different bank account for business and personal expenses to know actual amount utilize for business.
Thanks!!

S_Lindq
05-26-2017, 06:51 AM
Good question same prob with here. thanks for the suggestion. keep it coming ...bump

jacksonsamy2
10-19-2020, 02:58 AM
Understand the difference between personal and business expenses. ... Any expense that is directly linked to your business earning an income is a business expense. If you buy something to be used for your business, it's a deductible business expense. If you buy something to use privately, that's a personal expense

Muthuraj
11-18-2020, 01:06 AM
After the impact of the COVID 19 virus, most of the IT companies provide Work From Home offer for their employees. It reduces personal and business expenses.

raviseo120
11-19-2020, 11:46 AM
thanks for sharing with us

aaliyass
11-26-2020, 11:47 PM
With a higher credit limit Cecil Bank (https://bankingservices.live/cecil-bank/) as compared to other corporate and personal cards, the company claims that these corporate cards will empower founders to free up working capital expenses with zero personal risks and liability and a convenient repayment offering of up to 45 days of interest-free credit.

moverdubai12
11-27-2020, 01:47 AM
Comprehend the distinction among individual and operational expense. ... Any expense that is straightforwardly connected to your business acquiring a pay is a cost of doing business. On the off chance that you purchase something to be utilized for your business, it's a deductible operational expense. On the off chance that you purchase something to utilize secretly, that is an individual expense.