Icon Tax Group: Deductions For Commuters


by Michael Lodge

Here is a great article on commuters and tax deductions by Julian Block, his article is titled, “Road to Deductions Can Be Bumpy for Commuters”.  If you need tax help or tax preparation, call our office at:  877.778.1770.

Usually, the IRS adamantly opposes deductions for commuting costs between home and work. The agency considers those outlays to be nondeductible personal expenses, no matter how necessary. It makes absolutely no difference if a person’s work location is in a remote area not serviced by public transportation or that disability or illness rules out using public transportation.

These commuting restrictions also eliminate a deduction for payments to a carpool, whether each member takes a turn driving his or her own car or only one does all the driving. On the other hand, you needn’t report payments from riders unless they exceed your expenses.

Is it possible to get around these restrictions if you make calls to clients or business associates, or hold business discussions while driving to work? The IRS says that doesn’t transform the trips from commuting to business.

The agency does make some exceptions to its blanket ban on deductions for commuting expenses. One of those exceptions authorizes a limited measure of relief for someone who needs to haul bulky tools or equipment that can’t go in a car. You’re allowed to deduct the additional costs for hauling equipment, such as the charge for renting a trailer that’s towed by your car. The car costs, though, remain nondeductible commuting expenses.

The Tax Court agreed with the IRS that the additional-cost exception couldn’t be invoked by a college teacher who drove from her home in suburban Westchester County in New York to her job in New York City. The teacher used her car to transport books and other materials necessary to teach her classes, as the college didn’t provide storage facilities.

On teaching days, she left home at noon and school at 10 in the evening, and the drive each way was one hour. A trip by public transportation would have meant a walk of three blocks to a bus stop, a bus ride of 10 to 30 minutes to a train station, a train ride from the suburban station to Grand Central Station in New York City, and a walk or taxi ride of 12 blocks to the college – in all, a one-way commute of about 90 minutes.

On her return for the year in issue, the teacher claimed an attention-grabbing $7,500 for car expenses.

This set of facts prompted the court to conclude that the teacher would’ve gotten behind the wheel even if it hadn’t been necessary for her to transport her books. The court cited Fridays, when she still drove, though she had no classes and came in merely to attend meetings or take care of duties other than teaching.

Therefore, taking the books along didn’t cause her to incur additional costs.