Cell Phone Compensation

My employer recently changed our cell phone policy (from paying the bill) to giving us a fixed amount of money per month and we own the phone and line. What is the best way to categorize this in my bi-monthly paycheck entry in Quicken?

Secondly, is this treated as taxable income? Do I have to show a corresponding business expense on my tax return to avoid paying tax on it?

Reply to
Bobb
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No one here can answer your questions ... because the answer depends upon how your employer intends to handle the matter ... on whether they consider the amount to be taxable income (or not) and whether they intend to report the amount on your W-2, or not.

Go get the answers from your HR dept. then we can tell you how to record the amounts in Q.

db

Reply to
danbrown

It shows up on my earnings statement as "adjustment cell phone" and lists the amount. The cell phone sum is not being excluded from my federal taxable wages total for that pay period (just medical, dental, and 401k are.)

Reply to
Bobb

Then this is taxable wages. Just create a separate Income category for the phone compensation. Use one entry for Gross wages and another one for the Cell phone. Your w-2 at the end of the year should reflect both amounts.

Reply to
Laura

What I did was create a category under earnings called "cell phone." I "offset" the expenses paid out as negative cell phone income and created a report that shows both. That way I know if any of the income is taxable at the end of the year.

The next question is how I handle this on my tax return...I expect the expenses will exceed the income this tax year given I just bought an iphone. I wonder if I can "carry forward" the extra expenses to the next tax year. Hmm, it was so much easier when the company handled the bill but then again they weren't as generous with their cell phone allowance.

Reply to
Bobb

That certainly is a question better answered by your accountant.

Is this phone for work or personal purposes? The personal usage will not be deductible on your tax return so unless you own your own business or this is unreimbursed business expenses (required by your employer) then I don't think you can deduct the expense.

You certainly can not carry forward expenses from one year to the next.

Reply to
Laura

I don't have an accountant and have no desire to pay for one. I'm perfectly capable of doing my own taxes. Not to be rude but do you think my employer would be paying for a personal cell phone? Of course it's for work, I thought I made that clear earlier in the thread. How would one go about differentiating personal from work phone calls? That may work for company cars but not for cell phones.

There has to be a way to deduct the expenses, may need to ask that over in one of the tax newsgroups.

Reply to
Bobb

Famous last words.

Sure you are.

But you are being rude.

Reply to
John Pollard

You might consider reading "Publication 535 Business Expenses" which can be found at

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Not to be rude, but yes I can imagine a situation where a personal cell phone cost is paid by the employer.

Oilcan

-----Original Message----- From: Bobb [mailto: snipped-for-privacy@msmmsnsi.com] Posted At: Saturday, November 01, 2008 3:44 PM Posted To: alt.comp.software.financial.quicken Conversation: Cell Phone Compensation Subject: Re: Cell Phone Compensation

I don't have an accountant and have no desire to pay for one. I'm perfectly capable of doing my own taxes. Not to be rude but do you think my employer would be paying for a personal cell phone? Of course it's for work, I thought I made that clear earlier in the thread. How would one go about differentiating personal from work phone calls? That may work for company cars but not for cell phones.

There has to be a way to deduct the expenses, may need to ask that over in one of the tax newsgroups.

allowance.

Reply to
Oilcan

I have several clients that provide their employees with cell phones. They are allowed to use the phones for personal use too since they know that they can not monitor how the phone is being used. Company pays the full bill for the cell phone.

In your case you are paying for the cell phone out of your pocket and getting a partial reimbursement. Since you are an employee you do not have business deductions. You don't file Schedule C. The only place that you could deduct the difference would be on your Schedule A Line 21 for Unreimbursed Employee expenses. Both lines are subject to the 2% limitation so you might not even recover anything. It also assumes that you can itemize. Since you are being reimburesd for part of the expense I beleive you also need to fill out form 2106. Are you sure you don't want to discuss this with a tax professional?

Reply to
Laura

Thanks for being absolutely no help at all John. Is that rude enough for you?

Reply to
Bobb

Sugar daddy/momma?

Reply to
Bobb

Actually, I just compared two pay statements (w/ and w/o the cell phone adjustment) and it is not being counted towards federal taxable wages. So I guess this is a moot point. Thanks for taking the time to respond Laura. Your response was by far the most helpful. Call me cheap but I don't have a need for an accountant, if I didn't have a money market account I could file a 1040EZ.

Reply to
Bobb

Thanks for publicly insuring that you are a moron who spits on those who have offerred to help.

Since you have made it clear you are incapable of comprehending what you read, let me make it clear: I am referring to your comment to Laura, not to me.

Your much-to-late feeble attempt to apologize (to Laura) just doesn't cut it.

If you know you are going to make a rude reply before you make it (to someone who only attempted to offer well intended advice) - as you so clearly indicated - DO NOT MAKE IT.

Reply to
John Pollard

Hey Johnny boy, if you're going to bother responding to a thread at least try and make it productive instead of wasting other peoples time to insert your opinion. I personally could care less what you think, just butt out if you have nothing productive to say. I'm glad others actually responded with useful information.

Reply to
Bobb

Bobb, why don't you just FOAD??!

Reply to
Sharx35

Hey dipshit; I'll reply anytime I wish. Get used to it.

Reply to
John Pollard

Ever heard the expression "the pot calling the kettle black?"

Reply to
Bobb

Boy, am I glad I don't have an extra "b" in MY name :-) Bob

Reply to
Bob Wang

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