Mistakes With Reimbursed Expenses

Ms. Walker: Please help me!

I am an Adult Education Practitioner. Been an indie for 11 years.

My 2008 tax returns inflated my modest earnings because my company pays me as a 1099 contractor and included all the money paid as if it were earnings, when in reality, about 58% was nothing more than reimbursed up-front expenses.

I am still paying the federal government for that tax bill and was wondering if there is anything I can do retroactively to ease the burden going forward.

Reading over what you've said to others I take it that it was my primary responsibility to take along all my actual invoices where the difference between travel, hotels, etc. from speaking fees was clearly noted but I did not. Is there any way I might do that this year in an attempt to, if nothing more, lessen the burden of what I still owe the "feds"?

Thanking you in advance,
Hopeless


Dear Hopeless,

There are a few things you said that I don't quite understand. When you say that you've read what I said to others, if you don't mean all my posts here, expenses -- reimbursed, then be sure to do so.

I don't know where you were taking your actual invoices. To an IRS audit? To the people who hired you? Are you asking if the past can be fixed or just what to do for the future?

In the posts about reimbursements that I mentioned above there is an explanation of how to list reimbursed expenses on your tax returns in the future.

This is what you can do about the past: If you have proof that the income was expense reimbursement then have a tax pro file an amended return deducting those expenses. You will get a refund for the overpaid tax. You may file an amended tax return up to three years after you originally filed the return.

It's not hopeless.
-- June