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2 replies

Employee
June 17, 2019

If you are actually being audited in this scenario, you probably should secure professional representation or at least an in-person consultation with a tax professional.

 

It's unclear whether you had a sole proprietorship prior to forming a general partnership, and then forming an LLC, but you should have been filing a Form 1065 for the partnership, regardless, and not a Schedule C (which is for a sole proprietorship).

 

Nevertheless, with respect to categorizing the tuition and travel as unreimbursed employee expenses, you should be aware that for tax years 2018-2025, you can no longer claim those expenses as miscellaneous itemized deductions on Schedule A.

 

See https://www.irs.gov/publications/p529#idm140526615638528

 

Again, you should seek professional assistance with regard to  this matter, in particular, and your LLC, in general.

August 21, 2021

Tuition reimbursement programs need to have a plan document with specific eligibility requirement and are limited in the amount...(I believe it is $5000 per employee).   So as a small business, be sure you are offering to all employees, but your eligibility can be very specific.  Look up online for a sample education reimbursement plan.   IRS will want to see that Plan Document, and likely even employment letters to check eligibility.. Based on some Sch C audits we are aware of.