As a sole proprietor, can I file taxes jointly with my husband and use charges made for the business with his credit card as expenses?

by James F. Hay, CPA | Sep 07, 2018
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If I’m a sole proprietor of a business, can I file taxes jointly with my husband? I use my husband's credit card most of the time, including times I bought gas or paid a toll to travel to work. Can I use charges made to his card as proof of my business expenses?

You, as a sole proprietor, would file your business tax return on Form 1040 Schedule C.

Individuals who can file their federal tax returns as married filing jointly can each include as many Schedules C’s as are appropriate with their joint Form 1040.

Business expenses, regardless of payment method, can be deducted if such deduction is allowable under the tax code, regulations, etc. Documentation should be maintained contemporaneously as to the nature and business purpose of the expenses. I suggest that you download Publication 535, Business Expenses, from the IRS’s website.

There are specific recordkeeping requirements for travel and entertainment expenses, which are well explained in the IRS publications and instructions.

If your business is based in the home and there is space used exclusively for the business, I also suggest that you download instructions for Form 8829, Expenses for Business Use of Your Home. The IRS’s website, www.IRS.gov, is a tremendous source for information regarding the preparation of federal tax returns.

I always recommend that taxpayers use a specific credit card for business expenses, and only for charges related to the business. It helps assure that no expenses are missed when preparing a Schedule C.

For more resources, check out PICPA’s Money & Life TipsAsk a CPA, or CPA Locator.

Answered by: James F. Hay, CPA, is an associate professor of accounting and business at Wilson College in Chambersburg, Pa.

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