I did freelance work on the side and purchased several pieces of equipment to finish the project for a client. The client reimbursed me the exact amounts for those several pieces of equipment (I have reimbursement invoices and bank statements showing their deposits plus credit card statements/receipts for the purchases). Obviously I do not want to consider this taxable income since it was an exact dollar-for-dollar reimbursement for the equipment needed to finish the clients project.
Where do I input this information in TurboTax Deluxe???
Please help!
The "reimbursement" goes into gross receipts. The expenses are supplies - the stuff needed to finish the clients project.
Thank you very much for the response!
Question though. I thought supplies had to be $200 or less items? The per-item, individual equipment cost was definitely higher than that.
Would these go into a different category possibly?
If supplies has a low limit the Section 179 deduction and the Bonus Depreciation deduction are much larger. The De minimis rule is $2500.
Thank you so much!
Final followup and to clarify, the Section 179 deduction would allow for 100% deduction of the cost of the item, correct?
So for example, if the piece of equipment cost $1,000 and the client reimbursed me $1,000, I would put $1,000 under gross receipts and list that piece of equipment under the Section 179 deduction with a value/cost of $1,000, thus negating any potential taxes I'd have to pay out, correct?
Thanks again!