Deductions for unreimbursed business expenses

[rkdude02]

Question. I have a single-member LLC, which I use to represent my interests in a multi-member LLC that I help to operate and is taxed as a partnership. Can I deduct business expenses on my personal return (through my single-member LLC) that were not reimbursed through the partnership?

For example, let's say that I purchase a $1,000 computer out of pocket. It's an ordinary business expense, but it's over the agreed-upon budget for a computer purchase that I set with my partners. They reimburse me $600 from the partnership for the business expense, and so I'm left with paying $400 out of pocket. Can I deduct that $400 from my personal taxes on my 1040 using Schedule C? Along with other business expenses specifically for my single-member LLC (like incorporation fees, virtual address costs, etc.)?

[AmeliesUncle]

If it is a required Partnership expense and the Partnership specifically states you are responsible for that amount, it is an "Unreimbursed Partnership Expense" (UPE).

When you enter your K-1 from the Partnership, there should be a question asking about that and it will show up as a deduction on page two of Schedule E.  Do not enter that expense on Schedule C.