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Is the travel time billed to the customer taxable for FICA and/or other taxes?

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Our sales team thought to bill the customer for travel time from/to a customer. Are there any tax implications?

Answers

Topic Expert
Keith Perry
Title: Consulting CFO and Business Operations A..
Company: Growth Accelerator
(Consulting CFO and Business Operations Advisor, Growth Accelerator) |

T&M from a consulting standpoint is corp revenue. Corp revenue doesn't fall under FICA, which is only for payroll. Only. Travel time is no different from "work" time.

(unless you're an independent consultant, where you can run into trouble.)

(Agent, JKS Solutions, Inc.) |

Thank you.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

Keith,

Are you talking about a IC that's a sole proprietor? Then travel/work time makes no difference because bottom-line revenues are subject to FICA (unless that's what you meant, then in the words of Roseanna Roseanndana; "never mind").

Topic Expert
Patrick Dunne
Title: Chief Financial Officer
Company: Milk Source
(Chief Financial Officer, Milk Source) |

Travel time would be part of consulting revenue and applicable taxes (sales and use) would be charged to the customer depending on what state the work was performed. I don't think FICA comes into play at all, unless there is some other element I am unaware of.

(Agent, JKS Solutions, Inc.) |

When we bill the customer for onsite services, on the invoice will be entered: the services received, the travel expenses (example: hotel, car rental, and the travel time spent by our consultant to/from customer.
Thank you.

(Agent, JKS Solutions, Inc.) |

This is a small corporation. Thank you.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

From the Corp/Sub-S, FICA is moot. For the LLC/Partnership/Sole Proprietor FICA is determined on Income (share of income).

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