Everything You Need to Know About IRS Commuting Mileage Rules

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The IRS has prescribed what needs to be deducted against the taxes upon filing the returns.

Many people do not understand the laid down procedures of deducting tax.

IRS commuting mileage rules may be confusing, but you’re going to learn what you need to know about them here if you keep reading.

There’s nothing like commuting tax deduction. However, there are situations when your drives from home to work can become tax deductible.

Before you deduct the mileage from the taxes, you must have sufficient evidence of the mileage log as prescribed by the IRS.

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What Is Commuting According to the IRS?

According to the IRS, commuting (p.25) is the transportation between your home and your regular place of work.

Your home, in this case, is the place you live, and your regular place of work is the place where you earn a majority of your income.

Can You Deduct Mileage to and from Office?

As a general rule, commuting is not tax deductible. However, you can get around this by turning your home into an office.

Your home will only be regarded as your office by the IRS if you prove that you are a large percentage of your income or you do a majority of your administrative tasks from there.

Note that even if the IRS allows you to log mileage from home to your office, it will only allow you to claim the mileage incurred for business purposes and NOT for personal purposes.

deductible transportation expenses
Source: www.nerdwallet.com

What Is Commuting Deduction?

There is nothing in the IRS tax deduction rules that is called commuting that allows you to ask for deduction.

You can only deduct mileage for charity, moving or medical purposes or expenses incurred during driving for business purposes.

What Are the Rules that Apply on Commute to Work Mileage?

The following rules have been prescribed by the IRS in regards to the commuting to work mileage deductions.

  • The mileage between your home and your primary job location is NOT an allowable deduction.
  • If you have a temporary job and its location is different from your principal place of work, the mileage between the home and your temporary job location is tax-deductible. According to the IRS, any job that you engage in for less than one year is temporary.
  • If you are out on an off day from your main job, the trip between your home and the second job is not tax deductible.
  • Any mileage incurred between your temporary job and your main job is tax deductible.
  • The trip between your second job and your main job is an allowable deduction.
  • If you have several temporary jobs, and a second job, any trip covered in-between these two locations is an allowable deduction.
  • If you turn your home into an office, you can turn your commute drives into business drives which are tax deductible.

Example:

Joanne is a marketing professional who lives in downtown Manhattan. If she commutes from her downtown Manhattan apartment to her office, this will NOT be tax deductible.

Also, if she drives from her house to her client’s to make a presentation, she may NOT claim this mileage as a tax deduction as the IRS still considers this as commuting.

But, if she travels from her office to her client’s office to make a speech, she CAN claim this mileage as a tax deduction. For Joanne to make the claims, she must log her mileage properly.

How Can You Tell If a Drive from Home Is Tax Deductible?

The table below from the IRS Publication 463 – Travel, Gift, and Car Expenses outlines the deductible travel expenses: 

travel expense you can deduct
Source: IRS Publication 463 – Travel, Gift, and Car Expenses

Now, let’s get more specific.

Where You Live Is Your Personal Choice.

The IRS considers where you live a personal preference and therefore if you live far from your office, this will be your own expense and it is not an allowable deduction.

When Does Commuting Occur?

According to the IRS commuting mileage rules, commuting occurs when you drive from where you live to your principal place of work which can be either your office or your work site.

Commuting can also occur when you drive from home to a place where you’ve worked before or to a place where you expect to work for more than one year.

Don’t Be Cheeky! It’s Still a Commute.

Even if you drive from home to go and conduct a business, the IRS will still consider this a commute and not a business trip.

How Does the IRS View Haulage of Goods from Home to Office?

If you haul or carry some goods from your home to your office, the IRS might be persuaded to consider this a business drive.

In such a situation, the mileage deduction will include the cost of renting the trailer and all the other expenses relating to the haulage of goods.

How Does IRS View Working During a Commute?

Even if you make business calls or listen to work-related seminars or reply to emails during your commute to work, the IRS will still consider this a commute and NOT a business drive.

How Does the IRS View Advertising on Your Car?

Just because you have some advertising on your car, it doesn’t convert the mileage you take from home to your office into a business drive. The IRS will still consider this a commute, and hence it is NOT tax deductible.

What Are the General Rules about Commuting?

Although it is tough for you to determine which drive from home to office is tax deductible, there are some general rules that you can use to determine whether your trip will be an allowable deduction.

These are:

  • Commuting is NOT considered an allowable tax deduction.
  • Working during your commute to work will NOT turn your trip into a business drive, hence it is not tax deductible.
  • If you create a home office and can prove that you earn the majority of your income and do most of your administrative work from there, you can nullify the IRS commuting rule.
  • Any drive between your home and a temporary place of work IS tax deductible.

To make sure you log all your mileage correctly and stay away from trouble with the IRS tax authorities, consider getting a mileage tracking device.

Paired with a free app, it will keep your records impeccable and help you avoid confusion and hassle around the tricky IRS commuting mileage rules.

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