Travel miles are personal miles, meaning that people drive from their home to their place of work and from their place of work to their home. Since it's essential for employees to drive to work every day, the IRS considers mileage trips as daily travel expenses. Unlike business miles, what the IRS considers commute miles are not tax-deductible. Travel expenses are those that you incur as a result of the taxpayer's usual means of getting to and from work.
Travel expenses may include car expenses, bicycle expenses, and public transportation costs. These costs are not tax deductible in the U.S. UU. The first and most important thing to know about travel expenses is that they are never deductible.
The tax code understands that travel is a cost of doing business that affects both business owners and employees. Getting from home to work and back, even if that trip is a hundred miles or more each way, is a daily commute, not a business trip. The same thing happens if you work from home but occasionally go to Starbucks with your laptop. Your trip to the coffee shop is considered a daily commute, not a business trip, because you don't start working until you get there.
Transfer costs may include train, subway, bus or ferry tickets, or gasoline. Some companies offer a travel subsidy or incorporate the costs into benefits, but often the travel expenses are paid out of pocket by employees, managers and business owners. If you drive a car, ride a bike, or use public transportation to get to work, those expenses aren't tax deductible, even if you're the business owner. Trips to and from work to your home are considered daily trips and are not deductible as business trips.
If you travel frequently for work reasons, your travel expenses end when you arrive at work, and trips between that time and the time you leave work to go home can be considered business trips, not travel expenses. For example, if you're a contractor and you drive ten miles to your first place of work, those ten miles are counted as daily trips, but not as business trips. If you drive another 10 miles to a second site and another ten to a third site, those twenty miles are considered business trips and are deductible. When you leave the third place and head home, the miles you travel return to being miles of daily travel and not business travel.
If you work from home but decide to leave your home office to go to a coffee shop, the money you spend to go to the coffee shop will be considered a daily commute to work and is not deductible. This means that, once you've started working at the coffee shop, if you're traveling to meet a customer at another coffee shop, that trip can be considered a business trip and you may be eligible for a tax deduction. Internal Revenue Service. Publication 15-B (202), Tax Guide for Employers on Additional Benefits.
Leave Reply