Small Business Tax Savings Podcast How to Reimburse Yourself Tax-Free (The Accountable Plan Explained)
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Oct 29, 2025 Ever wondered how to get reimbursed for business expenses without extra tax? An Accountable Plan might be your answer! Learn the must-follow rules to stay IRS-compliant and uncover common expenses that qualify, such as home office, travel, and internet bills. Find out how to implement this plan effectively with simple steps. Plus, discover the crucial documentation to avoid audit trouble and potential red flags. This is your chance to save thousands legally!
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Accountable Plans Prevent Taxable Reimbursements
- An Accountable Plan lets owners and employees get reimbursed tax-free for business expenses they paid personally.
- Mess it up and the IRS can reclassify reimbursements as wages, triggering income and payroll tax.
Three Steps To Implement It Right
- Adopt a written reimbursement policy, use an expense-report template, and make reimbursements from the business to personal accounts.
- Implement monthly reporting to keep reimbursements timely and audit-ready.
Substantiate Expenses And Avoid Excess
- Require proof: receipts, dates, amounts, business purpose, and written notes on receipts showing who, what, where, when, and why.
- Return any excess advance or treat it as taxable wages to avoid disallowed reimbursements.