If you are an independent contractor, any money taken from the business account to cover personal expenses is considered a non-deductible draw. This is not the same as a wage or a salary, since independent contractors are not employees.
So the answer to this question is no.
In most cases, when an independent contractor pays themselves to cover personal expenses, it would not be considered a deductible business expense. Personal expenses are typically not deductible for tax purposes.
As an independent contractor, you are generally allowed to deduct business-related expenses that are ordinary and necessary for your trade or profession. These expenses must be directly related to your business activities and should be documented and supported by proper records.
If you are unsure about the deductibility of specific expenses, it is always recommended to consult with a qualified tax professional or accountant like Peter Witts CPA PC who can provide guidance based on your individual circumstances and the tax laws in your jurisdiction. They can help you understand which expenses are deductible and how to properly document and report them on your tax returns.
Need Accounting help? With 20+ years of experience, our experts at Peter Witts CPA PC are here to answer any business tax questions you may have.
I’m Kristin, the PWCPA PC Customer Success Specialist. For more information about this topic, or any other, you can always reach me through our customer ticketing system.
