Is it okay to use my personal cell phone for LLC business?

This might sound like a strange question, but I plan to use my personal cell phone to take applicant phone calls for the LLC (which I currently do for properties that I own in my name). The bill is in my own name, of course. Is this okay to do? It seems crazy to have two separate cell phones and accounts for this. Also, I'm in the same situation with the portable alarm that I use at both my house and the rentals. Thanks.

Anson Young

Real Estate Investor · Denver, Colorado

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Sep 06 '11, 12:25 PM

I dont see an issue with this, as long as you answer the phone professionally every time, dosnt matter if its personal or business you should be fine.

You can get the LLC to pay the phone bill, which is a bonus.

Chris Weiler

Real Estate Investor · Anaheim, California

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Sep 06 '11, 12:29 PM

I would recommend getting a Goggle Voice account that forwards into your cell phone. It's free and allows you to have a separation.

Rob Gillespie

Wholesaler · Valley City, Ohio

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Sep 06 '11, 07:29 PM

You are fine. The biggest concern of an LLC is using the account as your personal piggy bank. I would not be worried about using a cell phone. You can get other numbers, but I would keep it simple and be accessable. You will do more deals!! Good luck! :mrgreen:

Rob Gillespie, Rob The House Guy, LLC
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Steven Hamilton II

Accountant · Lake Villa, Illinois

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Sep 07 '11, 05:23 PM

Oh and for audit purposes most auditors will accept 50-80% of your cell bill as an expense unless you can justify on a bill by bill basis that your percentage of business use is higher.

Bienes Raices

· Orlando, Florida

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Sep 08 '11, 09:54 AM

Thanks for the advice. I didn't think it would be a big issue. I have no intention of using the LLC money for personal items.

Elena Smith

Residential Real Estate Agent · Siesta Key, FL

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Sep 08 '11, 10:40 AM

I too think its ok - just make sure to write it off properly. When my mother worked for an LLC she used her own cell phone.

Bienes Raices

· Orlando, Florida

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Sep 09 '11, 05:02 AM

There was another thing I wanted to ask about. On another forum someone mentioned that it's okay to pay for an LLC property expense with your own bank account or credit card as long as you make sure to submit an expense report to the LLC and have the personal account paid back by the LLC. Is this commonly done, and is it okay?

James Vermillion

Rehabber · Lexington, Kentucky

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Sep 09 '11, 07:07 AM

Originally posted by Bienes Raices

There was another thing I wanted to ask about. On another forum someone mentioned that it's okay to pay for an LLC property expense with your own bank account or credit card as long as you make sure to submit an expense report to the LLC and have the personal account paid back by the LLC. Is this commonly done, and is it okay?

This is an acceptable practice when done correctly.

I had to do this a few times when we were setting up our bank accounts. I tracked anything I had to pay for on an expense report as you said. I then paid myself back out of the LLC when everything was set up, and had both myself and my business partner sign that I was repaid and filed the paperwork. In QuickBooks I left a note referencing the paperwork.

Bienes Raices

· Orlando, Florida

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Sep 09 '11, 07:26 AM

^ Thanks James. This is a dumb question, but by "filing the paperwork" do you mean you put something in the corporate binder indicating that you were paid back?

James Vermillion

Rehabber · Lexington, Kentucky

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Sep 09 '11, 07:30 AM

Originally posted by Bienes Raices

^ Thanks James. This is a dumb question, but by "filing the paperwork" do you mean you put something in the corporate binder indicating that you were paid back?

Correct. We have hardcopy and electronic records. So I scan the signed paperwork, file it electronically and then put it in the appropriate folder in our hardcopy filing system. We like to have both in case something happens and either method is destroyed...a little more work but it makes me feel better about it.

David Wedemire

Real Estate Investor · Bellingham, Washington

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Sep 09 '11, 07:33 AM

It looks like your documenting all this which is the preferred way to go. Reasonable expenses are allowed. Just don't go overboard loading up the LLC

James Vermillion

Rehabber · Lexington, Kentucky

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Sep 09 '11, 07:38 AM

Originally posted by David Wedemire

It looks like your documenting all this which is the preferred way to go. Reasonable expenses are allowed. Just don't go overboard loading up the LLC

David makes a good point...this is not the preferred method and is not a viable long term method of running a business. I would recommend only doing this in situations where it is the only option, but if you have to, documentation is key.

Daniel Payne

Real Estate Investor · Ocean Springs, Mississippi

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Sep 09 '11, 08:12 AM

Just pay your cell phone bill as you normally would and write off 60-75% of it off as a business expense under the LLC. If you want to save on the paperwork just keep a schedule in excel for all the cell phone bills and cut yourself a reimbursment check at the end of each quarter for whatever % you select as business use. If you stay below 75% claimed as a business expense, you shouldn't flag any auditors. That's what I would do.

K.I.S.S. method is key. Don't overcomplicate things. Focus on building your business and leave the tedious tasks to your bookkeeper or accountant. I've seen a lot of people get so hung up in procedural things that they never get out and complete a deal.

Good luck!

Bienes Raices

· Orlando, Florida

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Sep 09 '11, 08:29 AM

Originally posted by Daniel Payne

Just pay your cell phone bill as you normally would and write off 60-75% of it off as a business expense under the LLC. If you want to save on the paperwork just keep a schedule in excel for all the cell phone bills and cut yourself a reimbursment check at the end of each quarter for whatever % you select as business use. If you stay below 75% claimed as a business expense, you shouldn't flag any auditors. That's what I would do.

K.I.S.S. method is key. Don't overcomplicate things. Focus on building your business and leave the tedious tasks to your bookkeeper or accountant. I've seen a lot of people get so hung up in procedural things that they never get out and complete a deal.

Good luck!

Thanks Daniel. I am not that worried about the tax part. My concern is doing something wrong that could allow the veil to be pierced. It appears that the expense report solution will work though for things like the phone bill.

Bienes Raices

· Orlando, Florida

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Sep 09 '11, 08:40 AM

Originally posted by James Vermillion

Originally posted by David Wedemire
It looks like your documenting all this which is the preferred way to go. Reasonable expenses are allowed. Just don't go overboard loading up the LLC

David makes a good point...this is not the preferred method and is not a viable long term method of running a business. I would recommend only doing this in situations where it is the only option, but if you have to, documentation is key.

I was only planning to do this for the tenant credit reports, phone bill and maybe the alarm system bill, because these items are hard/impossible to separate out. Everything else I would pay for strictly with the LLC bank account...does my plan sound safe?

Chris Colvard

Wholesaler · Dallas, Texas

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Sep 09 '11, 09:45 AM

I vote at for google voice. I am using 5 numbers that I can answer or call out on from my Iphone app.

James Vermillion

Rehabber · Lexington, Kentucky

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Sep 09 '11, 10:41 AM

I was only planning to do this for the tenant credit reports, phone bill and maybe the alarm system bill, because these items are hard/impossible to separate out. Everything else I would pay for strictly with the LLC bank account...does my plan sound safe?

What do you mean by difficult to separate out?

Daniel Payne

Real Estate Investor · Ocean Springs, Mississippi

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Sep 09 '11, 11:06 AM

Originally posted by Bienes Raices

Originally posted by Daniel Payne
Just pay your cell phone bill as you normally would and write off 60-75% of it off as a business expense under the LLC. If you want to save on the paperwork just keep a schedule in excel for all the cell phone bills and cut yourself a reimbursment check at the end of each quarter for whatever % you select as business use. If you stay below 75% claimed as a business expense, you shouldn't flag any auditors. That's what I would do.

K.I.S.S. method is key. Don't overcomplicate things. Focus on building your business and leave the tedious tasks to your bookkeeper or accountant. I've seen a lot of people get so hung up in procedural things that they never get out and complete a deal.

Good luck!

Thanks Daniel. I am not that worried about the tax part. My concern is doing something wrong that could allow the veil to be pierced. It appears that the expense report solution will work though for things like the phone bill.

I'm not a lawyer, but I'm pretty sure the mixing of funds to pierce the veil is about paying for strictly personal things with business money out of the account such as paying your personal mortgage, buying your friends beer, out of the LLC account.

I don't think buying something for the business with personal cash then getting reimbursed for it (if it's a legitimate business purchase) from the LLC is going to run a risk. You may want to double check that with a lawyer.

James Vermillion

Rehabber · Lexington, Kentucky

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Sep 09 '11, 11:33 AM

I don't think buying something for the business with personal cash then getting reimbursed for it (if it's a legitimate business purchase) from the LLC is going to run a risk. You may want to double check that with a lawyer.

I think what is being referenced is the fact that if an LLC is sued, the finances of the LLC will be examined. It is important to keep a separation between personal and business finances or you can lose the protection of the LLC. However, as long as it is not an overly common occurance and is properly documented, you will be ok. Note: I am not an attorney and am speaking on personal experience.

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