Can You Use Business Bank Account For Personal Use?
Yes, you can use your personal bank account for personal use. You see, there are some things that are considered personal use when it comes to the IRS. Things like using your home computer to make a web page for personal reasons. Here are some things that are not considered personal use and will help you with the tax season.
One: homemade wine. Just because you can store it in your basement doesn’t mean you can pour it into a taxidermy table. Now, some people might be crazy about that, but if you are truly concerned about how much it costs you to get the supplies, just go ahead and pour yourself a nice tall glass of red or white wine. It will taste better in a glass, anyway. If you want to call it personal use, that’s fine, just don’t use the business bank account to pay for it. Just pour yourself a nice tall glass and it will be perfectly acceptable by the IRS.
Two: electronic funds transfers. Even though you might think you are only using this account to pay bills and such, there is no reason you should not be able to use it to pay bills and even transfer money from your account to a personal checking account. As long as you aren’t taking short-term cash advances, you are allowed to do this. Just make sure you have the funds in the account before you try to complete the transaction.
Three: gifts. If the lady you are buying gifts for is your wife, boyfriend or girlfriend, then you can absolutely use business bank account for personal use. The exception to this would be if you are soliciting a donation. In which case, you absolutely must use a gift certificate to cover the gift-opening costs. Otherwise, you could find yourself with an inquiry from the IRS about why you are taking a gift from someone who has company money.
Four: Gifts. Probably the most obvious use for a business bank account is for personal uses. You can write checks for your wife or girlfriend, send birthday or Christmas cards and send flowers and other gifts on the same day. So long as you’re not soliciting a contribution to the campaign, you can use this account for personal purchases without having to disclose that you are doing so.
Five: Insurance. This is probably the most obvious of the business uses for this particular account. If you have a home business and are using your personal account for that, you can deduct the cost of your mortgage insurance from your income taxes. If you run a CPA firm, you can take advantage of a special allowable expense on your Schedule C. Personal use can also be stretched to include education, travel, phone calls, repairs and even legal fees. If you have a home business, you can deduct the cost of running it as well
Six: Pets. If you own an account, you may be able to claim deductions for pet care expenses. However, if the account is used for business purposes, you may need to obtain separate accounts for your personal and business use.
Seven: Childcare. Can you use a business bank account for personal use? This one requires some tricky questioning, if for no other reason. For instance, will the deduction be allowed if the account is closed while you’re paying the child’s tuition? As long as you’re not prohibited by law from using the account to make payments, you should be fine.
Eight: Sinking money in the ATM. Can you use a business bank account for personal use? If you’re trying to withdraw cash at the ATM, this may be the best use for the account. You can write a check against your personal checking or savings account and use the funds for any purpose, including buying lunch at a fast food restaurant. Just be sure to get a statement from the bank after you take the money out.
Nine: Travel. Can you use the travel fund to pay for tickets and lodging expenses? If so, be careful with the company you’re traveling with. Most of these companies offer frequent traveler programs, which may allow you to chip away. However, you may not want to choose a company that charges exorbitant fees just to benefit you.
Ten: Gifts. Can you use a business bank account for personal use? If you are shopping for your spouse or for any of your family members, then giving them a gift is an obvious personal use. But what about if you’re buying food gifts for your own employees? Be aware that some companies that offer gift cards often require you to make purchases with your personal credit card.