179 deduction for C corporation

[Pacun]

According to this article, the owner can get reimbursed if the company is an S corportation... is there something similar if the entity is a C corporattion?

"IRS regulation 1.62-2(d)(1) authorizes your S corporation to reimburse you for your employee expenses.

The regulation identifies expenses appropriate for reimbursement as those found in Part VI, Subchapter B, Chapter 1 of the Internal Revenue Code. Section 179 expensing is one of the many expenses in this section of the law that is identified as appropriate for reimbursement.

To make this work, you submit an expense report to your S corporation requesting reimbursement for your business expenses, including the $23,000 of section 179 expensing. You must also submit to your corporation a mileage log that supports your business use of this vehicle. Further, you must submit a mileage log for each of the next five years, as that is the time during which your corporation could suffer recapture if business use of the vehicle were to drop to 50% or less.

The expense report and mileage log combination creates a tax-defined "accountable plan" that

allows your corporation to deduct the expenses, and

makes the reimbursements to you not taxable.

Say you give your corporation a separate expense report just for the $23,000 section 179 expense. On the basis of this request and the information from your mileage logs, the corporation writes a check to you for $23,000. The corporation deducts the $23,000 as a section 179 expense as if it had purchased the SUV itself, subject to the rules that apply to the corporation for its expensing.

In general, your agreement with the S corporation will be for the corporation to reimburse all your actual vehicle expenses. If recapture should occur, your agreement could require you to reimburse the corporation for the recapture amount. Requiring the reimbursement is the easy way to handle this."

[OldJack]

Say you give your corporation a separate expense report just for the $23,000 section 179 expense. On the basis of this request and the information from your mileage logs, the corporation writes a check to you for $23,000. The corporation deducts the $23,000 as a section 179 expense as if it had purchased the SUV itself, subject to the rules that apply to the corporation for its expensing.

You can't believe everything you read. Sure you can be reimbursed for expenses, but for the S-corp to claim sec. 179 for a vehicle the S-corp must own the vehicle. If the S-corp reimburses for the cost of the vehicle, then title must pass to the S-corp as a deemed sale. Of course the S-corp passes sec. 179 expense/deduction to the shareholders which may include a prorated portion to shareholders other than the one selling to the S-corp.

This is the same for a C-corp other than nothing passes to the shareholders.