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QUESTION DETAIL
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I received a 1099 from a company that I provided business consulting services to for this year. They had provided me with a credit card to cover travel expenses. Should those costs be included in the form 1099 and can I deduct the expenses?
ANSWER
Expert Michael Lim's Answer:
These costs are deductible expenses to the company that you are providing consulting services for. They are not compensation for the services that you are providing.
Therefore, they should not be included in the 1099 that you receive, nor are are you able to deduct them as your own expenses (they are simply a pass through).
Alternatively, if you wanted to keep track of them for accounting purposes, you could elect to claim the reimbursements as income, and then immediately net the expenses against them (this would match the inflows and outflows to your bank statement).
