Hey, Abe! I have been gathering my expenses for the upcoming tax year, but I am unsure that I’ve included everything. Where do I need to start with expenses, and what factors into the business?
Tax season can be a stressful time as a business owner. Fortunately, we have options, so it doesn’t have to be that way! A good place to
start is categorizing the different ways that expenses are issued or recorded, which is how I like to think of expenses for a lease/owner operator.
Settlements
These are gold mines when it comes to reporting expenses. Better yet, the settlement is prepared by the contract company, which saves you time. At Abacus, we have a highly experienced team that will take the information from your settlements and ensure that it is accurately reflected on your tax record. A few items typically included in the settlement are fuel, lease payments and repairs, and preventative maintenance. These alone account for a large percentage of your overall expenses, but it doesn’t stop there.
Out-of-Pocket Expenses
These expenses are items that are not included in your settlement. Out-of-pocket expenses can include ordinary & necessary business expenses purchased from your business account, cash, or even personal account. For out-of-pocket expenditures, always keep your receipt as a record of the business expense and write down the amount on your Cash Expense Record form. These expenses are just as important and need to be factored in. A few examples can include your cell phone bill, days away from home for per diem, and general operating equipment and supplies that you use for the business.
- To submit your out-of-pocket expenses, simply fill out our cash expense record forms, available through our website
or upon request. Try to keep up with these at least once a month to be sure you do not forget any valuable expenditures. - We are a full-service accounting firm. If you find yourself with a lot of receipts and not enough time to go through them, let us do it for you! We have a phenomenal receipt sorting service and will ensure your expenditures are accounted for. Simply let us know that you need your receipts sorted and bring them by or send them to us by mail. Don’t let that folder/box/suitcase/shipping container full of receipts go to waste. Abacus is here to help!
Questions? You can reach us at 417.380.5000 or at transportation@abacus.cpa.