Dear Tax Talk,
I have two offices, one in my home and one in our corporate office in another state, 1,700 miles away. I travel between the two bimonthly. Can I deduct any of the travel expenses for flying and/or driving between the two?
You cover a lot of territory and provide few details. Deductible business expenses include travel expenses while away from your home. Your home means your tax home.
Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. If you have more than one regular place of business, your tax home is your main place of business.
Consider the following when determining which one is your main place of business or work:
- The total time you ordinarily spend in each place.
- The level of your business activity in each place.
- Whether your income from each place is significant or insignificant.
If you’re only going to your corporate office once every two months, then most likely your regular place of business is your home. When you travel away from home, your expenses for meals, lodging, transportation, laundry and other incidentals such as tips are deductible.
Unfortunately, if you’re an employee, these expenses are considered miscellaneous itemized deductions. This means to obtain tax benefit you have to itemize your deductions, and the total is reduced by 2 percent of adjusted gross income. Further reducing the value of the deduction, miscellaneous itemized deductions are added back for alternative minimum tax. It’s better if your employer reimburses you for these expenses.
To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Taxpayers should seek professional advice based on their particular circumstances.