If it is a general principle that a person can deduct money they spend on work-specific items, then why is it that I cannot deduct* the mileage I commute to work? Does the IRS believe that I would drive 120 miles a day just for fun?
On a YANMTL (You Are Not My Tax Lawyer) note, is that something that has been fought in Tax Court and if not is there any possibility a judge would rule it is a work expense?
*Assumption is itemized deductions including commute is more than standard deduction. My commute would be about $15,500 for the year.
ETA: I see mileage between a first and second job IS deductible making my question all the more WTF?! Maybe I should find a job bagging groceries at the store next door for 5 minutes every weekday morning.
Under the proposed corporate tax plan, export sales would not be subject to income tax, and purchases of goods and services imported from other countries would not be deductible.
Commuting expenses are personal expenses and not deductible because they are a function of your choice in where to live. I can’t find an IRS cite for it, but it is mentioned here:
There is a pre-tax federal transit benefit, though. I get my monthly MetroCards with pre-tax money via TransitChek, which amounts to the same thing as deducting transit expenses.
I’m not sure that that’s the general principle. I know you can’t deduct clothing unless it’s not suitable for wear outside of work - not just that you don’t wear it outside of work, but that it’s not suitable. So you can’t deduct suits or pantyhose or red golf shirts or khakis or anything else that someone might wear for something other than work even if *you *in fact would never wear it.
I also know that you can only deduct the expenses that exceed 2% of your adjusted gross income and then your total itemized deductions have to come out to more than your standard deduction - and the reality is that most people therefore aren’t deducting any business expenses at all. Outside salesmen might, or people who maintain home offices and don’t get reimbursed - but not most teachers who from what I can tell spend an average of $500-$1000 on supplies. Not office workers who might spend a few hundred a year on the office equipment/supplies that they prefer to what their employer supplies.
What if the person needed to have their car at work because they used it for some work related purpose and, if they didn’t have that, would walk or bicycle to work? Has that ever been ruled on?
Keep in mind that, if you are injured on the way to work in your normal commute, you are not entitled to workers’ compensation benefits, either, thanks to something called the “going and coming rule”, which establishes that the normal commute is not within the scope of employment (the injury doesn’t arise out of the employment and occur during the course of employment). Since it’s not part of your employment, it’s not shocking it’s not deductible as a work expense.
I never would have expected workers’ comp to cover my commute, but now I’m curious. I wonder what the situation would be if you were coming or going to an off-site location. Assume you’re exempt, have an office at a particular address, but go offsite to a visit a plant that’s further away than your commute. Your employer pays mileage at IRS rates beyond your commute.
And while we’re at it, the same situation, except you’re on a month-long assignment at a remote plant. You’re driving home for the weekend, and the company is paying IRS mileage.
Teachers do in fact get a special tax break by being able to deduct up to $250 for supplies and materials. But not other workers who buy their own supplies.
As mentioned, if you are counting on consistency, fairness and logic in the tax code, you are looking in the wrong place.
We had an employee (boss) collect worker’s comp when he went out to start is vehicle, and while removing the jumper cables from the battery it exploded, injuring him (not too seriously). The argument was that as part of his job he picked up other employees to take them to the remote site (ski hill) so using his vehicle and ferrying other employees was part of his job.
Another fellow I knew was cycling to work. Very athletic fellow, so he was going full speed down a familiar road. Immediately after crossing the property line, he hit a railroad track, flipped, and broke his pelvis. The crews had started repairing the crossing and had uncovered the track, so he hit a 4 inch high obstacle at about 25mph. Because he had just crossed onto company property, he was covered.
OTOH, Canadian Worker’s Comp boards tend to be AFAIK a bit more lenient with their awards than what I hear about the USA.
Uber drivers have a nice loophole to get around this. We can’t deduct either for “commuting to work”, but our work is essentially everywhere. We CAN deduct for cruising around town seeking passengers. So I get up in the morning, turn my app on to accept passenger calls the moment I get into the car, and every foot I drive until I turn off the app is deductible.
And Uber has a solution that might work for you, Saind Cad. Become a driver. The app has a function you can use called “Set Destination”, and at home you set the destination for your work address. Uber will route to toward any passengers along your travel route who are going the same general direction as you. You get a fee for the ride, and all the miles from leaving the house to dropping off the passenger are deductible.
At the end of your work day, set your destination to your home address, and do the same thing in the opposite direction.
The “going-and-coming rule” is applicable only to normal commutes. Not shockingly, there are “exceptions” which, essentially, are situations where the employer obtains benefit from some particular variation on the “normal” commute to and from work. These exceptions are very state specific, as workers’ compensation is one of those areas of law which has not been made uniform across the various states. When I was learning workers’ compensation law (as a very wet-behind-the-ears attorney in the '80s), studying the cases on this particular aspect of AOE/COE was fascinating. In 10+ years of doing that work, I think I actually had two cases with serious questions about the rule. :mad:
Being an Uber driver just during your commute would probably get Uber to drop you. Even if they didn’t, I very much doubt you would get a deduction that exceeded the cost of the extra insurance you must have for using your vehicle commercially.
The situation in the UK is very similar, without any 2% rule. I used to deal with mileage claims in the NKS and we used the same rules as HMRC do for tax relief (only back to front so to speak).
Fine for someone who drove to their office and then went out business, finishing back at the office. Not so easy if they started at home and went straight to somewhere else. We had many members of staff who had responsibilities in three different hospitals; we also had staff who did home visits. Any sensible person would call at the nearest place to home first and maybe some more before checking in at the office (or maybe not). The rule was that they could claim for all mileage after the first call, up to the last. mileage from home to the first call was not claimable unless it was more than their commute.
Uber requires a minimum of 1 drive per month from its drivers, so there shouldn’t be any corporate blowback about it.
I hadn’t thought about insurance, but my rideshare coverage costs me about $400 a year beyond what my regular private insurance had cost. If Saint Cad is theoretically picking up 400 passengers a year (2 each day during the week days) that amount should be easily covered.