Latest / The Chiro Money Show / 044 | Can I Write That Off? A Chiropractor's Guide to Business Expenses
Transcript
- Chris: Welcome back to the Cairo Money Show, where we're helping chiropractors make better financial decisions so they can build stability in their finances and a lifestyle that they love. We're your hosts Chris Scheel and Scott Campbell, financial planners with Align Wealth. Scott: Chris, I couldn't help but notice right away, I know our AI audio stabilizers will do the trick for us here, but your room sounds very echoey. You have nothing in the room anymore. If you're if you're watching on YouTube, there's nothing on the blue wall anymore behind Chris. The the move is happening. The move is in the horizon. Yeah. But the blue wall's Chris: Getting real. Yeah. The Scott: there. You and you're gonna leave the blue wall behind to the new buyers. Chris: Yeah, yeah. Maybe they'll join the team, who knows? Scott: I hope they don't paint over the blue wall. I hope they like call it the blue room and like bring it into their home and someone embraces it. Yeah. I hope so too. Chris: I hope so. I hope so. Yeah. I don't know how quickly I'll get around to painting the the new blue wall in my new office, but we'll see. We'll see. Scott: I'm sending you I still got at least a half gallon of blue paint, so it's going with you. We'll see. Chris: Yeah, I don't know if we have room for that in the move. She's tight. We're we're currently paying playing Tetris, packing everything we can into our our moving container. And yeah, Scott: All right. Well Chris: so life is life is full on right now. And yeah. Things are half packed. Scott: That's right. Yeah. Chris: Soon enough we'll be in BC. Mm-hmm. Scott: Yep. Well, all the best here on the upcoming move. As far as the topic today, what are we chatting about today, Chris? Chris: one of our favorite topics. I won't say it's picking on accountants, but kind of. We're talking about No, no. Fine, fine. We're not picking on anyone, Scott: We're not picking on we're not picking on anyone here. We don't pick on people. No, no. No. No. Chris: but Scott: A fun topic of ongoing discussion with clients along with their accountants. And that is write offs. What Chris: Yes. Yeah. Scott: you can write off as a business expense. We've seen it all. I know I've seen it all. It's Chris: Mm-hmm. Yeah. Scott: Yeah, it's a funny in interesting topic. Before we dive in, I actually have a really great clip from YouTube that you can listen in on if you're listening. Enjoy if you're on the YouTube. I'll play a quick clip here. What what clip do you think I'm gonna play? Chris: Shits Creek. Scott: I knew you were gonna say that, and that's because you're not as as old school as as me. I'm actually gonna bring in a clip from my favorite show of all time here, so hold Chris: What? Scott: up, hold up. Chris: Seinfeld. Scott: Got some Seinfeld. Chris: Yes. so good. That never gets old. Scott: Yeah, I love the Shits Creek clip as well, but had to go old school Seinfeld for that one. Chris: That's a classic, man. I could watch that over and over. It's f Scott: Mm-hmm. But it's true. Chris: it's true, man. Scott: I think a lot of our clients don't know what don't truly me I'm I'm saying that tongue in cheek, like what a r what a true write-off is. Like I I think there's a common misconception that once you set up a corporation that you are automatically kind of in this kind of new territory of a methodology of being able to gamify the system and and create some further tax efficiencies inductions. And and to some degree there's a there's there's opportunities to optimize, but in a lot of ways there's also a lot of people who are putting Expenses through their business on a regular basis that they're just an audit away from basically just getting themselves into a big headache of an issue with the CRA, getting an audit, proving that proving these expenses, making making sure that they were legit expenses, and in some cases if they were not, then they have to pay back taxes along with interest and it turns into a big mess, right? Chris: Yep. Yeah. I I totally agree. There I think the non-business owner community or like before as people become business owners, they believe that like it it's gonna there's gonna be all these advantages. And while that is true in some senses, it's like really there there's not that much difference. Like, sure there there are some opportunities for legitimate things, but You know, the end of the day, you can't just put everything through your business all year round all year long. Scott: Mm-hmm. Chris: And like you can't just do that. What's gonna happen is at the end of the tax season, your accountant's essentially going to reassign or assign some of those expenses as personal benefits, and Scott: Yep. Chris: it's gonna be attributed back to you in the form of a surprise tax bill. Scott: Yep. We'll touch on that. We'll touch on a on a story of a kind of the Chris: Yeah. Scott: downside of that kind of approach, especially on the high end. But before we get into that, let's let's first talk about what an actual expense is. Like what what's what would you bec what would be considered like maybe the CRA's test when it comes to actually making someone from a high level, what what is a a deductible expense that they could that you can run through your business? Chris: really anything that was incurred in the process of you earning business income? Was it required for you to earn an income? If it was not required or or like necessary, it's likely not totally covered as a business expense. And Scott: For sure. Chris: then secondly, is the amount reasonable? So you can't say that like, you know, I well one good example is like, you know, I need I need to buy a pen to do my, you know, sure, I need a pen on my desk to to do my job. Fair. Scott: Yeah. Chris: But I don't need a hundred thousand dollar pen. Scott: Great. Chris: I need a one dollar pen. Like, is that reasonable? man, I yeah. I'm sure they are. Yeah. Scott: I'd love to see a hundred thousand dollar pen though. Show me what that looks like. I'm sure they're out there. Yep, for sure. Yeah, the the point here in terms of like the the gut check that that one could make in terms of wondering if you are if you're maybe t potentially crossing a line with with putting running an expense through your business. Like if it makes makes you squirm a bit having to potentially be in the hot seat trying to explain it to an auditor, then you probably know what the answer is going to be from said auditor and the CRA in terms of their opinion on that expense or how much how much of one type of expense you're trying to put through your your business on an annual basis. Chris: Yeah. Scott: Right. So let's talk about maybe some of the the most common things, we won't get into everything, but maybe some of the more com common conversations that we're having with our clients and again in some ways collaborating and talking to their CPAs about like what they what they should be doing from a from a tax deductibility standpoint. Let's talk about vehicles first, Chris. What's the most common thing that we kind of have questions on from clients and we're having, yeah, ongoing Chris: Yeah. Scott: conversations about should I do this and why or Chris: Yeah. Scott: why not? Chris: Yeah. I think the first one is like can my corp own my vehicle or lease my vehicle? And like o obviously isn't that a good thing if like my corp I I pay with my I pay for my vehicle with pre personal tax dollars and Yeah, I can see how that, you know, feels good, but at the end of the day, if if the vehicle is not primarily being used to earn business income, i.e. if you have a clinic that you work at, there's not really you know, there's not really a lot of vehicle expenses that are gonna be covered in in that, right? You can't claim your commute from your home from your home to your place of main place of work. Now if you have two or three clinics and you're and there's quite a distance between them and you're traveling between them frequently, yeah, okay, now we're getting into some legitimate things where you need to travel to a different clinic in order to earn an income. Sure. But yeah, Scott: That's right. Yep. Chris: that's probably the most common one is like, I just want my corp to own it and pay for it because that's easier, it doesn't mess up my personal cash flow plan. Scott: That's right. Yep. Yeah, there's obviously there's obviously a time and place for for when it makes sense. Like if you're say one of those chiropractors who had like a mobile office and you went around to people's homes at doing doing your adjustments and g delivering care, then absolutely you could probably write off the majority of your vehicle expenses through your corporation. But for I would say what, ninety five percent of the chiropractors out there who are driving to their place of work and then driving back, there's really very little reason to have any sort of vehicle expenses running through your business. That said, like if you I'm just an example here, like if you were, say, living where we live in Edmonton and you were going to say a conference in Calgary and you wanted to drive, you're gonna drive down the highway and, you know, rent a hotel room and go to a conference, you could write off the mileage from Edmonton to Calgary for that for that business trip. That's totally acceptable, right? And that's where you get essentially a a rate per kilometer that's essentially attributed back as an expense to the business and then the business essentially owes you that back personally. But what we see all too often is We have someone who puts all their business all their vehicle expenses, sorry, through the business, their maybe their vehicle payment, their auto insurance, all their gas purchases, and in Chris: Maintenance. Scott: and maintenance as well. And in and in some cases, some of that would be deductible. But like you were saying earlier, and we're gonna get into an extreme example of this later on in the conversation, but you might feel like, all right, I'm putting it all through the business, and maybe you're aware of it, maybe you're not, but in a lot of cases you're you're accountant's gonna then if they're doing the if they're doing their job properly anyways they're gonna be asking you for some sort of mileage log to understand what you did in total business business mileages versus versus personal and then whatever was personal use like you said Chris it's basically all wrapped up again and then attributed back to you in the form of income which you then pay taxes on and usually that's distributed back to you in the form of a dividend in a lot of cases you weren't planning for that extra tax owing on said dividend amount being attributed to you and then you get into this like messy tax cycle which we've talked about in the past with kind of random draws from the corporation. This is almost kind of like a random draw. Like you're you don't really see it in the moment, but it's gonna be attributed back to you as a random draw at the end of the year. Boom, added to your tax return, extra tax bill to pay. Right? You're no further ahead. At the end of the day, you're no further ahead. That's kind of the point here. Yep. Chris: Yeah. No. No, exactly. And our in our opinion, the much more advantageous way to go is like Okay, if you if you use your vehicle for business use five percent of the time, well then yeah, claim your mileage on that and get reimbursed for that and get like that tax bonus at the year end where the corp owes you money tax-free, that's a Scott: That's right. Chris: way better place to be than having your business own the vehicle, but 95% of that ownership cost and maintenance and ongoing cost being attributed back to you in the form of compensation at the or personal benefit at the end of the year. Yeah. Scott: Mm-hmm. I think this is a very similar similar th touch point on home office expenses as well. Again, it's gonna be variant depending on your accountant and their comfortability but with how much home office expenses they would kind of seem deem to be acceptable to run through the business. But say say you did s you could you could prove that you do a fair bit of say, maybe do your notes and any sort of business work, all from your h home office called that. At that point, then you can legit takes a certain por portion of your square footage of your home and a certain portion of your, what is it, your home insurance, Chris: Yeah. Scott: may maybe your alarm system, a portion of your internet, but you can't just be like, I'm just because I'm working at h because I'm doing a bit of my notes at home, I'm gonna run my full home internet bill through the business. Doesn't work like that unfortunately. Like it would be a portion of that. Whether you're aware of it, whether whether you're not, that's that's that's what's up for debate here, Chris: Yeah. And like like we've already said previously, in a lot of these cases, even if you your accountant is allowing you to put that put that expense through, it's not usually claimed as a full business deduction. It's usually Scott: That's right. Yeah. Chris: a proportion, like an amount a percentage of it that is a legitimate business deduction. that is attributed to you earning income. Scott: Yeah. And one caveat here before we move on, like one thing that's important to mention too, like this all also hinges on how detailed and thorough your accountant is, right? At at the end of the day it's not It's not always the accountant that's on on the hook if there is an audit for what they're putting through the business. Like at the end of the day, the buck stops with the business owner. Like if you're putting, say, your home internet through your business in full, but really in theory it should have only been a portion of that being deducted as an expense, and then you get audited, that's not on your accountant. Like maybe you can maybe you can go after your accountant for some of some of that. But at the end of the day, it's gonna it's gonna be on the business owner at the end of the day, So you can't just always trust that your accountant's, you know, you have to you have to make sure. So you had the right professionals in your corner doing doing the good work too. Chris: Mm-hmm, for sure. Should we go on to some other gray areas? We've already talked vehicle and and home office, those are pretty common. I think Scott: Yep, for sure. Chris: maybe before we move on, we should mention like there are some docs that you don't work out of their home. And if you if you have a home-based clinic where you you know you're treating patients from your home, that's completely different, That opens up a lot of opportunity for further deductions because that is your main place of business. Scott: Mm-hmm. At the end of the day, it's still only a portion of your home. Like it's gonna Chris: Yeah. Scott: still be a square square footage. Maybe you can get away with putting more of your say internet or some things like that through your business, but it's still gonna be a portion because you still have a a lot of of a lot of your home being used for personal use, not just for business. Alright, should we talk about the next fun area that we see a lot of when we open up that transaction history on a QuickBooks Online? We see a lot of meals and entertainment, a lot of transactions going through there. I think there's often I think there's oftentimes a lot of confusion about what that what that what that is in terms of an expense, an an an eligible expense. So f first and foremost, if if you weren't aware of it when it comes to meals and entertainment being run through the businesses and expense, only fifty percent of that of any sort of meals and entertainment expenses, like going out to a restaurant, for example, only fifty percent of that expense is going to be a deductible expense to the business. Okay. I think the reason for that is like part of it, I think I think they're maybe saying like half of that's gonna be for the business owner, like a benefit to the business owner, and half of it's gonna be for generating you know, for the sake of ideally trying to generate business, I think the the biggest kind of issue I see in this area when I'm reviewing someone's QuickBooks and looking at all the expenses is that maybe the the amount is maybe call it reasonable, but the sheer number of transactions that I see going through some of these ledgers in terms of meals and entertainment, the worry that I have for a lot of my clients is like you might get away with running this through because it's a reasonable amount in total, but if you don't have the documentation of every single receipt saying, hey, I went out for a meal with XYZ client to generate business. That's hard to prove. Like you know, there's obvious of obviously some unique things you could do, like say you're in business with your spouse and they're your office manager, you can probably get away with putting some more meals through the business and talking about business at meals. you know, maybe you're trading out your staff, that's a whole different category in terms of staff kind of meals and entertainment as well. So it's just an area to be mindful of. when I s when I open that up for a year and there's, you know, a hundred and twenty transactions, lots of skip the dishes, lots of lots of lots of meals and entertainment kind of going through there. I just question of whether or not if you get audited, if you actually have the paper trails to to legit show that these were all fair expenses. Would you agree? Chris: Yep. Yeah, absolutely. I think it's interesting there the like the exception for like staff events. That's Scott: Yeah. Chris: like you mentioned that's that's kind of set different, right? Like there's two, yeah, kind of two distinct areas here. It's like business, like meals and entertainment for the purpose of generating business, i.e. you're taking out clients, you're networking, etc. That is covered at 50%. Then there's the exception for staff events if they're open to all staff. then it you can get a hundred percent exception or deduction on those events. Scott: Mm-hmm. Mm-hmm. Chris: Which is I think that's great, right? It's like allows allows employers to treat their staff and not be kind of penalized for that. Like being able to fully write that off Scott: Yep. Chris: is like incentivizing us to in a way to yeah to treat our people well. Scott: For sure. And it all make it all makes perfect sense. If if you have a a nice team of staff and you want to tr take them all out for a for a nice meal and or even beyond Chris: Mm-hmm. Scott: that, like go do some sort of fun activity, it makes sense because you are doing a that is a legit expense. You're doing some team building that's helping support the business to grow revenue. Like it all makes sense when you really think about it from a big picture standpoint. Right. Chris: Mm-hmm. Yep. Yeah. Scott: Should we talk about golf? Let's talk about golf. We got some golfers Chris: man. Scott: in our in our roster of clients that that probably Hate these rules or try and push it to the limits? Chris: Yeah. Yeah, golf is a golf is a big one. And I mean, yeah, ultimately the CRA is very, very clear. They hate golf. Scott: Ha ha. Chris: Period. Full stop. They hate it. It's not d Scott: No no no one's on the no one in the C R A is on the P G tour, Chris: No, no. I mean maybe they're fans of the game. Maybe they're like. Yeah, yeah. Scott: Maybe not. No Chris. They hate it. They won't watch that sport. Chris: No golf for us if you're a C or A person. but yeah, basically they they explicitly state that green fees for golf are not deductible full stop. Like, doesn't matter what kind of business you are doing on the course, who you're golfing with, green fees are not deductible, period. Scott: Yep. Or full country club membership, golf membership, you name it. All the above, right? Chris: Yeah, yeah, exactly. Any and that goes for any club, any membership that where you ha purpose the main purpose is recreation or dining. So like there's Scott: Yeah. Chris: a lot of, you know, memberships, clubs out there where yeah, that's the the purpose. It's like a yeah, the social club, really. Scott: Right. Doesn't have to be doesn't have to just be golf. Chris: No, it can be any number of, you know, activities. Those pickleball. Yep. Scott: Yeah, pickleball. Yeah. I'm sure that's growing. Chris: Yeah. Those Those fees for those annual memberships are not deductible. Scott: We haven't had anyone try to deduct like a pickleball membership quite yet, but I'm sure it's on the horizon. Yeah, for sure. Chris: Yeah, growing sport. Yeah. Scott: But what c when you when you finish up your game of golf though, Chris, what could you potentially deduct? As like at least at Chris: Yeah, here's Scott: least make let's make this let's make our golf listeners feel a little bit better. Chris: Okay, sorry yeah. The the one kind of positive you can take away if you're going to golfing, if you stop for a meal in the clubhouse after golf and clubhouse for sure, man. Yeah. Club a clubhouse in the clubhouse. Scott: What's your meal? What wait wait wait, what's your go to meal after a round of golf? A nice clubhouse. Pint of lager. Yeah. Okay. Yeah. Chris: if you do that and there is real business purpose and an itemized receipt separate of green fees, then it applies, you know, back to the same meals and entertainment where Scott: That's right. Chris: 50% of that is deductible. Scott Campbell: Hey it's Scott here with a quick addition to today's episode. After the recording today, Chris and I were just wrapping up and realized we talked a lot about what you can deduct. We talked about how only 50% of meals and entertainment are deductible, 100% of green fees are not deductible, but we never answer the obvious kind of follow-up question of okay, so what actually happens to that money then? So here's the thing non-deductible does not mean your business can't pay for it. Those are two different concepts, and this is where a lot of confusion comes from. So I'd like to take you through a real example. So let's start with meals and entertainment. You take a referral partner out for dinner, and the bill is, say, $200 on your corporate. Credit card. The full $200 comes out of your business bank account, and the full $200 shows up as a meal, meals, and entertainment expense on your books. Nothing strange there. What happens is there's an adjustment at tax time. So when your accountant prepares your corporate return, there's a schedule where they essentially reconcile your total income versus your to your taxable income. And one of the standard adjustments is what's referred to as an add back, adding back 50% of meals and entertainment. So, say for that $200 expense, $100 or $50% of that meal gets added back to your income for tax purposes. So the technical term is an add back and it's what's called a permanent difference. So that $100 never gets deducted as an expense this year or any year. What it means in dollars is say you live in Alberta and you're paying the Alberta small business tax rate of 11%. Rather than it being 100% deductible, $100 of that meal or 50%, you're gonna be paying about an extra. Extra corporate tax. That's it. So, same kind of thing works with golf. Golf works the same way, except it's at a hundred percent. So, you could take a client out, put the green fees on the corporate credit card. Again, this is totally fine. Again, it has to be for the purposes of generating income and business expense. So, as long as there's a real business purpose, the full amount of that green fees is gonna be put on the credit card. But in the case of golf, the full amount gets added back at tax tax time. So you don't you don't get any deduction from But you're still funding that round of golf with corporate dollars where you're paying a lower corporate tax rate than if you're paying for it with personal dollars, paying maybe a tax rate of 35 or 45% plus. So there is a significant tax saving savings there in terms of putting that expense through through the corporation. But the catch here is that it's still, like in the case of golf, for example, is that it still only works if it's a genuine expense. Taking a referral partner or a potential associate out golfing, that's going to be an add back, no problem. You're gonna pay. That lower corporate tax rate than on the personal side. But if you just love golf and want to run your personal golf expenses through the corporation, that's where your accountant's gonna do what we're gonna that we were discussing in this episode in terms of adding that back as a shareholder benefit gets attributed back to you where you're gonna pay personal income on that. So hopefully that clears up any sort of confusion. If you're wondering of like what happens to that extra 50% that's not be deducted if I'm putting the whole, say, restaurant bill through on the business credit card, hopefully that clears things up. So, all right, that's it. That's all all I had to say. Let's carry on with the last little bit of today's episode. Scott: Yep. You know, at the end of the day, we're we're not trying to be Debbie Downers here. We're just stating the facts. At the end of the day I we're I wouldn't say Chris and I are are conservative when it comes to tax write-offs through the business, we're just realistic in terms of what the CRA says is a write-off or not. You obviously have to end up working with an accountant that you align with. And there's obviously varying degrees of accountants of like very conservative versus those that really push the limits. And we're not saying that one is better than the other. It's fine finding an accountant that you that you want to work well with, but understand that at the end of the day, just because you have put it onto a business card and even if it's been put onto your on onto your return as an expense, That doesn't mean it's all said and done. Like there is a number of years. I think it's seven years that the CRA can open up your file and say, hey, we want to do an audit. There's also different varying levels of an audit as well. Like there's an audit, like a full-on audit of your full return. And they also might do these spot audits where I know I've had a spot audit a couple years ago on a certain category, like one particular area of like I think it was, I don't think it was Meals Entertainment for me. It was something similar though of like show us all these receipts, especially these larger transactions. Can you prove that these were all expenses? That can happen to anyone. They can be like, hey, this year we're gonna we're gonna pick on professional corporations and we're gonna we're gonna pick on this particular category of an expense. Let's let's have at it, right? You don't wanna get you just don't want that headache. It's not worth the the small amount of like tax savings to go through that stress. And then potentially the back tax and interest that c comes along with that. It's Chris: Yeah. Scott: just not worth it. Chris: I think yeah, just to to kind of summarize this whole this whole topic, this whole idea, it's like the juice is not worth the squeeze. Like you're you're not going to change your financial life by optimizing a couple more write-offs or taking a little bit more risk in how loosely you you play with the the CRA rules. Like that's not moving the needle. Period. Like Scott: Yep. Yep. So true. Chris: Get it dialed in, get it, get comf like get your systems in place for how you manage your expenses and and you know how you connect with your accountant. But there's much bigger fish to fry here. Like, let's focus on what really matters, what's in your control. Because the CRA rules, they're not in your control. Scott: That's right. Speaking of loosely Chris, like let's talk about a client story that can to wrap up this conversation about the extreme end of how, you know Some like a a client story that resonated with us because it just was again the juice was not worth the squeeze. Essentially, this accountant told their client or a mutual client at at the time saying, Hey, we want we want you to essentially, if you think it's a business expense or or in that category, basically run as much through the business as you want as an expense. So we saw everything. We saw kids' swimming lessons all the way to like a ton of meals and entertainment to home decor, Chris: Travel. Scott: travel, like you name it. The list went on and on. And on in terms of like tens of thousands of dollars being ran through the business as an expense, with the client being like, I'm not exactly sure, but my accountant told me just to kind of put it all through the business and then they would sort it out at the end of the year in terms of like going through those transactions and taking a portion of it, making sure that it's reasonable in air quotes reasonable and running that through as an expense. Like you said earlier, to kind of kick off the conversation, the the downside of that is that the larger majority of those tens of thousands of dollars of transactions that were running through the business were not eligible expenses. And the and to the accountants, like the accountant was a was probably doing a good job in terms of looking at through those transactions and making decisions on like this is amount, this this is what can be put through, this is what can't be put through. But a lot of it, the majority, was saying, Nope, this is not gonna be an actual expense and we're gonna attribute it back. Back to you in the form of income, in the form of a dividend, and that increased that individual's tax bill, which they weren't prepared for said increased tax bill, and it just turns into this vicious cycle. Well, you had $20,000 of expenses that were run through the business that got reattributed to you back as a person as personal income. It's not worth it. It's just not worth that extra stress. Chris: And I'm not sure if this was the case or not, but I've heard of heard of people using some like rough guidelines and like percentages even of like, you know, when it comes to home office or vehicle usage or meals and entertainment, it's like, okay, well, if that is X percentage of your gross revenue, you know, the CRA is not likely to investigate. And I think that's kind of where it maybe this could have started from is like You know, the the CPA is looking at the client's total revenue and it was like a pretty high volume practice and, you know, Scott: Yeah. Chris: good, really, really great business. And so they're like looking at kind of the the guidelines and saying, Well, hey, we should we should try to get more expenses through 'cause like you guys don't have that much of expenses because Scott: Yeah. Chris: you know, in this case it was actually an associate that, you know, wasn't didn't have a huge rent expense, no you know, no employees. Yeah, they Scott: Yeah, overhead's small. Overhead's not very big. They're an associate. Yeah. Yeah. Chris: Yeah, overhead small. So it's like, well, let's try to let's try to get as much as we can. But again, it just caused this this tax trap, this this this cycle of like this recurring tax bill of, you know, these expenses that are being reattributed. And it was a mess. And Scott: Yeah. It was a mess. Yeah. Chris: the client was not even aware of it. in their mind, it was my my accountant says I can put more through the business. They that Scott: That's all they hear. That's all they hear. Chris: That's what they heard heard. They were Scott: Yeah. Chris: unaware that 80% of those expenses they put through the business were being attributed back to them personally at the end of the year. Scott: Yeah, at the end of the day, we're we're not trying to be Debbie Downers or like ultra conservative in this on this perspective, but like I know From from my take, I think it's just it keeps your life easier if you keep business business and personal personal. And if you do have, say, home office expenses or some mileage or even some things that you're like, I think I pay pay for this personally, but I think this potentially could be considered a business expense. Pay for it all personally and then bring it to your accountant and say, Hey, I did XYZ. Here's the expense. I think it could potentially be a business expense. If it is, then the business only owes you that money versus it being added to your tax return in the form of additional income. And now you have like a essentially a bonus that the that the corp then can pay you out this tax free benefit to you because they owe you, right? So much cleaner. So much more organized. Chris: So much cleaner. Yep. Scott: Yep. Chris: Yep. So to wrap it up, at the end of the day, what we need to think of when we're when we're spending as a business, the the test or like the kind of in our mind, was this expense incurred to in order to earn income? Is it reasonable in in the amount? And can we prove it? Can we keep Scott: Mm-hmm. Chris: that history, that transaction receipt, and prove that? Your life is gonna be so much easier if you, like Scott said, keep it clean. You know, business is business, personal to personal, run the right expenses through the right cards, and at the end of the year, no surprises. Right? There we have enough, we have enough on our plates to deal with as practice owners or business owners. Like you don't need extra stress come tax time, and this right here is one of these things that can save you from that extra headache. Scott: Cool. Well said. Should we wrap it up there, Chris? Anything else add? Chris: Let's leave her there. Scott: Okay. Well, thanks again for listening in. Hope you all enjoy the rest of your summer, about midway through. It's going by fast. So enjoy and we'll see you all again next week. Thank you. Chris: See you next week.