Legal Question in Business Law in Florida
Business owner's use of company credit cards by family members
My employer allows family members to use company credit cards to buy whatever they want. They are not on the payroll, and don't even live in the same state as the business, but use the credit cards liberally. When confronted with how this practice is draining needed company resources, I was told that the members using the card are ''paying him back'' for that usage. That seems strange to me, as it would be easier to just pay for things themselves, rather than use a credit card and pay back the company owner. I don't know if the payback money is going back into the company's account, or the owner's pocket. Also - this is a corporation, not a sole proprietorship. I'm guessing this is not legal... Is it?
1 Answer from Attorneys
Re: Business owner's use of company credit cards by family members
It may or may not be legal. Depends on if it is paid back and depends on what is reported to the IRS as a company expense or not.
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