Expenses that are part personal and part business

by Jay
(MD)

As a single member LLC considered a pass through entity by the IRS I deduct part of my mortgage and utilities on my taxes. I also have a cell phone and additional landline that are for business but they are in my personal name as they were set up before the LLC was created, when I was a sole proprietor. Is it best to pay for these expenses from my personal or business bank accounts? I would think that paying mortgage and electric, etc. from a personal account and taking a deduction is not seen as co-mingling funds but how about the landline and cell phone that are in my personal name but used for business.
Thanks.

Answer

The simplest answer is to open up a cell phone plan for your business and use that exclusively for your business conversations.

Otherwise, technically, to take a business deduction for your phone calls when the line is in your personal name, you're going to have itemize your phone bill and show which calls were personal, which were business, and determine the percentage of the bill that were business.

By the time you go through all that, you're ready to just pay the darn tax and be done with it!