How to account for class-action settlement


C

Charles

My C corp received a small amount of money (under $100.00) from the
LiPuma class action settlement with American Express. The issue was that
American Express had used incorrectly high foreign-exchange rates for
purchases made outside the U.S.

My question is how to account for this refund, which covers charges over
a several-year period? Some of those were undoubtedly employee travel
meals, which are only deductible at 50%.

I don't know how much was awarded for each year. Even if I could figure
it out, surely I would not be expected to amend returns for such a
trivial amount?

Thank you,

Charles
 
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A

Arthur Kamlet

My C corp received a small amount of money (under $100.00) from the
LiPuma class action settlement with American Express. The issue was that
American Express had used incorrectly high foreign-exchange rates for
purchases made outside the U.S.

My question is how to account for this refund, which covers charges over
a several-year period? Some of those were undoubtedly employee travel
meals, which are only deductible at 50%.

I don't know how much was awarded for each year. Even if I could figure
it out, surely I would not be expected to amend returns for such a
trivial amount?

No need to amend. Just add to current income to the extent the recovery
provided a tax benefit in the past.
 

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