How to Reimburse Yourself Tax-Free (The Accountable Plan Explained)
Small Business Tax Savings Podcast
Audit Red Flags and Documentation Requirements
Mike warns about documentation, receipts, timely reports, and excess payments that can trigger reclassification as wages.
If you’ve ever paid for business expenses out of pocket, like your phone bill, internet, or home office, and wondered if you can get reimbursed without paying more tax, this episode is for you.
In this episode, you’ll learn how an Accountable Plan lets business owners legally reimburse themselves and their employees tax-free. You’ll also discover the 4 key rules every plan must follow to stay IRS-compliant, and the most common mistakes that lead to audit trouble.
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Chapters
(00:00) The Overlooked Tax Strategy That Saves Thousands
What is the Accountable Plan? This allows you to get reimbursed for business expenses you paid personally without triggering extra income tax.
(01:10) What Is an Accountable Plan?
A simple breakdown of how this reimbursement policy works and why it’s essential for S Corps and C Corps.
(02:44) Who Needs an Accountable Plan
When owners and employees qualify, and why sole proprietors handle this differently.
(04:14) How to Set It Up Step-by-Step
The 3 essential steps to properly implement an Accountable Plan include creating a written policy, using expense report templates, and making reimbursement payments.
(08:35) Common Expenses You Can Reimburse Tax-Free
Examples like home office, internet, travel, mileage, subscriptions, and meals that qualify under an Accountable Plan.
(10:30) Avoid These IRS Red Flags
Why documentation, receipts, and timely reimbursements matter, and how to keep your plan audit-proof.
(11:45) Quick Recap & Next Steps
The four key rules of Accountable Plans are that expenses must have a clear business connection, be properly documented, exclude any excess reimbursements, and be submitted on time.
Podcast Host:
Mike Jesowshek, CPA – Founder and Host of Small Business Tax Savings Podcast
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🎙 ABOUT THE PODCAST
The Small Business Tax Savings Podcast is your go-to resource for cutting-edge tax strategies to help entrepreneurs legally slash their tax bills. Hosted by Mike Jesowshek, CPA, this show breaks down complex tax topics into clear, no-fluff insights so you can keep more of your hard-earned money.
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