Commuting or Business Mileage

[Jiggers]

Corporate taxpayer. Sole shareholder/employee.

Consultant. Works offshore, has to travel about 600 miles to location of helicopter that takes him to the rig. He does maintain an office in his home with computer and FAX machine. He maintains records, bills his customer.

He bills his sole customer for his time, plus his travel miles to/from location of helicopter, plus motel/meals.

Can he be reimbursed for his mileage, motel, and meals as an accountable plan. Deductible by the corporation, non-taxable to him, the sole shareholder/employee?

[ChEAr$]

corporation?

Corporate taxpayer. Sole shareholder/employee.

Consultant. Works offshore, has to travel about 600 miles to location of helicopter that takes him to the rig. He does maintain an office in his home with computer and FAX machine. He maintains records, bills his customer.

He bills his sole customer for his time, plus his travel miles to/from location of helicopter, plus motel/meals.

Can he be reimbursed for his mileage, motel, and meals as an accountable plan. Deductible by the corporation, non-taxable to him, the sole shareholder/employee?

I hope you mean that it's the corporation which has the contract with the customer.
And that he is an employee of the corporation, getting a W2 form.

So then, if the corporation bills the customer for fees and travel, then the corporation
does the deducting, not the employee. There is no accountable plan, since that
pertains to employee expenses reimbursed by the corporation.

That's the way it should be handled, corporation bills customer for EVERYthing. And
therefore deducts everything possible, except that means will be subject to the 50%
rule.

[Jiggers]

Commuting or Business Mileage for Corporation

The corporation has the contract with the customer and receives all the payments.

The sole shareholder/employee receives a W-2 from his corporation.

The corporation pays the hotel and meals for his travel from his home office to the job location. The 1120 takes the 50% hit on the meals.

Can the corporation reimburse him mileage from his home office to the job location?

I hope that this is clearer. Sorry, brain muddled because I have been working 8-day weeks: Sunday thru Sunday!

[ChEAr$]

Hate to keep asking questions, but

So this is a regular "C" corporation? and is it's main office in home of
the owner/chairman/general manager/president?

If so, then I see nothing wrong with there being an accountable plan after all.
Just make sure he does formally "account" for mileage, turning in periodic
vouchers and cutting a periodic (month?) check.

[OldJack]

He bills his sole customer for his time, plus his travel miles to/from location of helicopter, plus motel/meals.

The corporation pays the hotel and meals for his travel from his home office to the job location. The 1120 takes the 50% hit on the meals.

The corporation can reimburse the owner of the vehicle (tax-free) for the business travel mileage.

The corporation should not take a 50% meal disallowance as it has passed the hit to its customer by separately itemizing the expense and getting reimbursed from the customer. The customer therefore has to take the 50% non-deductible hit not your client. On the 1120 you should show the meal expense as 100% deductible as "reimbursed meal expenses" or some wording to that effect.