EntrepreneurFix Is a Free Entrepreneur, Business and Start Up Forum

Connect With Other Entrepreneurs Online Today!
Dismiss Notice
Welcome to Our Community
Wanting to join the rest of our members? Feel free to sign up today.

What can I spend my business money on?

Discussion in 'Accounts and Finance' started by TannerD, Jan 19, 2015.

  1. TannerD

    TannerD Entrepreneur

    Is there a list or an online check or article that states what I can spend my business earnings on if I leave the money within the business accounts?

  2. Enronitis

    Enronitis Business Owner Entrepreneur

    What do you mean, business money?
    You'll have to be more specific.
    If you're talking about profit, you can obviously spend it freely.
    As long as you aren't purchasing illegal items, you should be fine.
  3. kristoffer laukamp

    kristoffer laukamp Entrepreneur

    What kind of money are we talking about here?
    If you are talking about money, that are in the company, you may only use them to buy things that are for the company, and not for private. If you are paying your own monthly income, you may use those money for whatever you wish to. If the company is registered, remember to keep track of your finances and invoices.

    You cannot ea. go buy clothing for yourself, unless you only use that cloth for business(That has to do with your company).
  4. 308Digital

    308Digital Entrepreneur

    The IRS doesn't limit what you can spend your money on. They limit what you can claim as a business expense.

    For example you could use one bank account for both business and personal use and make payments for both business and personal expenses from the same account as long as you are able to separate your business expenses from your personal expenses come tax time there wouldn't be a problem.

    Business owners don't do this, however, because it creates an accounting nightmare which is why it benefits you to have a separate account for your personal and business expenses.
    K likes this.
  5. nigel

    nigel Entrepreneur

    on things you likes
    308Digital likes this.
  6. Azen

    Azen Entrepreneur

    I think the thing that really messed people up is when they think they can go ahead and write off something for business that ends up having nothing to do with the business at all. Is that maybe where you are going with this rather than actually buying things for the company?
  7. Investor

    Investor Entrepreneur

    I would never spend "business money" on anything not business related. People get too focused on what their company can do for them, and not what they can do for their company. Why have a company in the first place if you'll violate the meaning behind the structure?

    Something most people don't realize is that when you start to fund your personal life out of your business you risk creating a precedent of commingling. This can have potentially devastating results down the road if either you or your company were to get sued.

    If you have a company, specifically an LLC, or some sort of vehicle designed to protect your personal assets from your business and vice versa, you can potentially erode this protection by partaking in commingling.

    The very best advice is to pay yourself a salary from your company, or initiate disbursements as identified in your operating documents. This creates a valid transfer of funds from one party to the other. It's tempting to lease yourself a car and start charging everything to the business credit cards. But if you're growing, the best advice is have some patience, grow some more, and start paying yourself when you can. The time for company leases, and expense accounts is AFTER you have a CPA and/or business accountant. The time NOT to start these things is when you have to ask an online forum on the Internet this question.

    Anything else would create a potential issue for you going forward.

    Disclaimer: I am not a professional account, CPA, attorney, etc. My answer is my opinion. See professional counsel in tax and legal matters.
    K likes this.
  8. Rezonate

    Rezonate Entrepreneur

    It all really depends what you're talking about here but a good portion of the money should be reinvested back into the company if haven't already done so. That is the mistake of some business is that they fail to realize that their business always needs improvement and the only way to do that is to reinvest some of the earnings back into the business or employees.
  9. Bonyi

    Bonyi Entrepreneur

    I think the first thing to do is invest back into the business so that you can have more profit and little on yourself at the initial stage of the business. Watch your business grow and with time, you'll be benefited
  10. djentre

    djentre Entrepreneur

    Like Bonyi said, invest it back. Other than that, you can spend it on anything. You can show most things as business expenses and save a lot of headache that way.
  11. eProject

    eProject Entrepreneur

    Consider expanding you business first before you can think of spending it on other things. You can hire experts who will give advice on how to improve. You can also use your profits to advertise your business online and on written media.
  12. setupdisc

    setupdisc Moderator Entrepreneur

    You can spend it however you like, but I would strongly suggest that you retain business expenses for business, and personal expenses for personal. There are folks who let it overlap, especially if they have a reason to do so to where they can write off expenses that are personal but can be considered business expenses at the same time, but I wouldn't make a habit of it.

    The only restriction to this is if you are using grant money, if you have a contract specifying specifically how you can or cannot use funds if acquired from a lender or other official source, or any other kind of legally binding arrangement. If you run a non-profit and misuse donations, that's another no-no. Other than that, you can pretty much use your funds however you wish when it comes to your business if you feel that investing in a certain area or purchase will be money well-spent for you.

Featured Businesses (View All)

Share This Page