Ways to Deduct Commuting Costs from Taxes

To qualify for transportation deductions, you must be traveling away from your tax home to a business location.

Here are prime examples:

1. Working from home: If you’re self-employed and your home office is your principal place of business, your tax home is the same as your regular home. In this case, you can deduct the cost of visiting a client or customer across town if you keep the proper records.

2. Multiple business locations: If you’re based at one of several local job locations and travel between them. The cost of the travel between the two business locations, regardless of the method, is deductible.

3. Short business stops: If you visit a client or customer on the way to work or on the way home, you may deduct the cost attributable to the travel between your regular place of business and the client or customer’s place of business.

4. Temporary assignments: Your business may require you to work at a distant job site for a short period of time. Instead of making a long commute each day, you might decide to stay close to the work site and come home weekends. Assuming that the job lasts no more than a year, it qualifies as a temporary assignment. You can deduct your lodging and meal expenses, within certain limits, plus the travel between the distant work site and home.

Detailed record keeping is required to make sure your claims can stand up to any tax department challenges. 

If you would like to learn more or to set up a consultation call Marlies Y Hendricks CPA PLLC at either 716-694-3500 or 910-769-8730.

The above information is of a general nature only and should not be relied upon for specific situations.