As a business owner, you have the responsibility and discretion to make many kinds of purchases. Did you see a deal on office supplies on Amazon last week? Buy a fun item for your personal collection on eBay? Decided to purchase a group of gift cards or promotional items to use as employee perks or customer giveaways? There are so many great deals out there, but…. Have you thought about what needs to happen after you hit the ‘buy it now’ button?
In the last two years, online purchasing through these two sites has soared among the general population, and that includes business owners. But, chances are, these purchases are hitting your pocketbook harder than you think. By their nature, these purchases show up as Amazon or eBay charges on your bank or credit card statement. If you have not supplied the detail to your bookkeeper, these charges will likely go against ‘owners draw’. The result: you will be paying personal income taxes on items you have purchased for the benefit of the business. Thousands of dollars can get added to your taxable income!