OIH shareholder

[Gretel]

I know we had this discussion repeatedly but I am still not sure if allocated repairs could be reimbursed through accountable plan.

...or asking the other way round: Is depreciation the only expense that cannot be reimbursed?

[Gretel]

Ok, forget about the original question. I did a lot more reading and it seems depreciation is an open issue.

BUT..the first time in my life I looked at the worksheet in Pub. 587 (2008) page 26. Line #11 troubles and confuses me.

Why would or should an employee or farmer put any office un-related expenses here and limit the OIH deduction? Instructions say f.e. travel, supplies. For an employee it doesn't matter too much since this worksheet is used to get reimbursed by employer.

On the other hand a farmer is supposed to use this line for all his annual other expenses????

[Bees Knees]

Line 11 is not used to deduct the expenses. It is used to determine the OIH deduction limit. Look at line 13. Line 11 winds up in line 13. Line 13 is then used for the line 24 calculation which limits OIH deductions to net income. Remember that the OIH deduction is limited to net income from the business. Or in other words, you can't use OIH expenses to create a loss.

[Gretel]

Thank you so much, Bees. Of course, now it makes sense. Feel a little stupid now, but that's OK. Helps to be more patient and humble.