Personal Expenses on a Business Account (Groceries, etc.)

[July123]

How do I categorize personal expenses on my business account? These personal expenses are groceries, gas, amazon.com orders, and etc.? Another thing, my rental business did not make any revenue in 2020, I did not make any payments to myself or anyone ( No Payroll) aside from spending some money for personal use. 

[JoannaB2]

The personal expenses are non-deductible as business expense.  For your gas expense, you can either choose to claim standard mileage ( mileage usage only) or actual expenses (gas, insurance, repairs, depreciation of the car, and other related business vehicle expenses).  You must determine the business percentage usage of the vehicle and deduct based on the business percentage. For example, if your total mileage driven for the whole year was 20,000 and the business miles was 10,000, business percentage was 50%.

If you are a sole proprietor or a single-member LLC, you report your income on Schedule C,  You can't pay wages to yourself not unless you're an S-Corp and an employee to your S-Corp.

If you have rental loss, you can deduct your loss up to the amount of your earned income.

[nextlaunch]

I'm still somewhat confused about this situation as well. Let's say you made 2,000 in income and your rent + groceries were 1,500. Is it not considered part of the operating expenses that you need to pay for rent and food to operate your business as a sole proprietor?

For example, what if we were just starting out and needed the money to cover rent and food?

[SweetieJean]

Why are you asking about groceries?  Do you run a B&B, or otherwise provide food and supplies to your tenants?

[nextlaunch]

Well due to inflation groceries are a significant expense in the day to day operation of working on client projects. It's part of keeping the staff healthy and focused. Aren't meals and groceries basically the same thing?