Welcome back, KaymeaSedona.

You are very much welcome. 

Feel free to post again if you have other concerns. We're always here giving our best to help you out.

I don't think your response is correct... What am I missing? 

I conclude that:

Reimbursed = 100% deductible (with $ limitations) 

Unreimbursed = 50% deductible (some exceptions)

Below is directly from the IRS website:

https://www.irs.gov/faqs/small-business-self-employed-other-business/income-expenses/income-expenses...

• Generally, reimbursed non-entertainment-related meal expenses are deductible if your business trip is overnight or long enough that you need to stop for substantial sleep or rest to properly perform your duties. You can figure all your travel meal expenses using either of the following methods:
  • Actual cost. If you use this method, you must keep records of your actual cost.
  • The standard meal allowance, which is the federal meals and incidental expense (M&IE) per diem rate. The GSA website lists these rates by location. Note that lower rates apply for the first and last days of travel.
• The deduction for unreimbursed non-entertainment-related business meals is generally subject to a 50% limitation. You generally can’t deduct meal expenses unless you (or your employee) are present at the furnishing of the food or beverages and such expense is not lavish or extravagant under the circumstances.
• For more information on a temporary 100% deduction for food or beverages provided by a restaurant paid or incurred after December 31, 2020, and before January 1, 2023, refer to Notice 2021-25PDF. For more information on a special rule that allows the temporary 100% deduction for the full meal portion of a per diem rate or allowance, refer to Notice 2021-63PDF.

BTW, that did not answer his question. I think the following link may offer a solution:

https://quickbooks.intuit.com/learn-support/en-us/reports-and-accounting/how-do-i-setup-an-account-f...

Hi I have a similar situation.

I provide services for a company as a PC, in addition to the regular income I receive for hours worked, I now will receive travel reimbursement ( of $50 per day).  
how do I enter this in quickbooks online ?

thanks 

I appreciate you for joining the thread, @Ghram. It's good to know that you'll now receive travel reimbursement from your client. I'm here to guide you on how to record the amount in QuickBooks Online (QBO).

Once your client deposits or gives you the amount for the travel reimbursement, you can deposit the money to the account used for the travel expense. Here's how:

1. Sign in to your QBO account.
2. Go to the +New icon, then select Bank Deposit.
3. Choose the correct account under the Account drop-down.
4. Fill in the details under the Add funds to this deposit section.
5. Save the transaction.

You can also get more tips while recording bank deposits in QBO from this article: Record and make bank deposits in QuickBooks Online.

You may also reach out to your accountant for more options in tracking the reimbursement.

Please leave a comment below if you have other QuickBooks questions. I'm always here to help. Have a good one!

Thank you

This is ABSOLUTELY CORRECT!  You do NOT post the purchases/project costs that will be reimbursed by a customer/client, to your expense accounts.  You should set up a balance sheet (other asset/.current asset) account called  "unreimbursed project costs" (or "unbilled project costs").  Then when you make purchases that will be reimbursed they get posted there (debit "unreimbursed project costs" and credit "cash or credit" (however you paid).

When the customer is billed for this cost, you can either add a line on their invoice for "unreimbursed project costs" OR create an item and have it get posted to this asset account (credit "unreimbursed project costs" and debit "A/R").

Overall, the account on the balance sheet ("unreimbursed project costs") zeros out, and the P&L is unaffected.

You do not want to, especially with timing differences, have under or overstated net income for your company, because you have these expenses posted, which really belong to another company!

[email address removed]

There is another way, under the "+" sign, where you can add transactions etc., under VENDORS, you will see "Create Vendor Credit".  This is the easiest way, but it might depend on what version you have, #1. And #2, if you use a vendor credit, you should always make sure to either auto-apply so just remember you have a credit to apply when you pay the vendor's bills, because it is not in all versions that it show you have an available credit to use.

@Rustler based on your response, is it worth breaking out billable expenses in QBO for the accountant? For context, I am specifically referring to QBO expenses that I incur on the client's behalf. 

If they are being reimbursed, yes.  Especially at year end.  This is because you do not want to pick up the expenses if they are going to be reimbursed.  That would mean that the following year, you would be picking up income.  Best to set up an "Other Current Asset" account, on the balance sheet, it will track any expenses that have NOT been billed to your clients (accrual basis reporting) or reimbursed by your clients (cash basis reporting) as of the last day of the year.  This way they are just held in an account waiting for the reimbursement, and your books and taxes will not be affected.

This is an old post, so i hope your out there....Not to beat a dead horse, but.... help?

I am an event planner. I paid a hotel bill as a pass through $20,000. I invoiced 5 companies (sponsors). they paid $20K. I paid the bill. In QB it looks like $20K revenue and $20k expense. Am i going to be OOP or SOL when i file my taxes? IS there a better way to log this? I tried to follow the "set up a liability expense and income account but dont know how to change the invoice and payment to fall under those accounts.