Home Depot Consumer Credit Card - how to avoid comingling funds.

This is a question that just occured to me and I thought about asking here…

I have a LLC and I am planning to buy my first investment property through the Company. I am keeping my money segregated from the LLC money. For example - I use my personal car to go see properties. Every month I submit an expense report to the LLC asking to be reimbursed for the mileage. My expense voucher needs to be signed by the other member of my LLC (my wife). There is a check that goes from the LLC bank account to me for the reimbursement. The basic idea is that I am trying to avoid comingling my personal funds with LLC money. I do the same for my real estate fees. I pay out of my personal account and then submit an expense voucher to my company for reimbursement.

My question - if I get a Home Depot consumer credit card in my name and use it to purchase materials to rehab the property will this be considered comingling. Somehow I feel that the mileage and licensing fees examples above are fine. But I don’t think this would work for materials purchased for the rehab. Do I need to purchase them with Company’s money?

On a side note - do you know if I can open a Home Depot consumer credit card on the name of my company?

Thank you.

I really see no problem with using a personal card for company matters. Many consultants use a personal card for travel expenses and get reimbursed by the company. You should get a corporate HD card, but I suggest a corporate Visa/MC or Amex. They have better benefits.

Thank you BLL.

you’re not comingling until you make both a personal and a business purchase on the same card and have the company pay for it.

if it makes you feel better - or makes it easier - put the purchase on your personal home depot card and submit an expense report to the company for reimbursement. deposit the check in your personal checking account and pay your personal debt to home depot.

mcwagner - thank you. I am fine with the approach you suggested (submitting an expense report). However I am worried with your first statement - so if I get a HD consumer credit account can I use it for my personal purchases as well as for my Company’s purchases and then submit an expense voucher for my Company’s purchases? Or should I use it only for my Company’s purchases and not do any personal purchase on it?

Thank you.

I think you are fine using the card for both personal as well as business purchases as long as those purchases are kept separate and you fully account to the company and reimburse yourself.

Let me give you an example. You work for a company and fly to another city for a business meeting. You use your personal credit card to pay your expenses and the company reimburses you when you get home. That is reasonable isn’t it?

I found that as soon as I started my LLC I regularly got credit card offers for the company. I applied and based on my personal credit I got credit lines of $20-25K. I had to personally guarantee the loans but I now have credit in my companies name and can avoid any concern of the issues you are discussing.

I am not an attorney or CPA and the above comments are my laypersons understanding of the law. Do not construe the above as legal advice for your specific situation.

ncarey -thank you for the insight. I am also starting to get offers on the mail. The first one came from Capital One. Actually the first 2 came from CapitalOne… They are offering me the Capital One Visa Business Platinum Card… Sounds impressive… I will wait for other offers and pick the best one.

The thing with the HD Consumer Credit Card is that it offers a very good deal (6 or 12 months with no payment or interest for purchases over $299). I can’t get it with a regular business card. This is the reason why I was asking if I could use a personal HD account to buy stuff for the LLC. Based on the responses I got, it seems I can as long as I submit the expense reports…

Thank you.