From : San Jose, CA
Dear TaxMama,
You are so right about temp-ing. Great way to make some money, get
to meet a lot of different people and go different places, and get to know
the job market and businesses before hiring on as a regular employee.
And I have never temp-ed anywhere that I haven't learned some new and great
skill!
Right now, in today's economic environment, it's the easiest way to get a
job. So a few questions, please. What expenses are deductible
for us? Travel? Meals? Do they go on Schedule A, Line 20
or elsewhere? Are other forms required? Travel logs or diaries
are a good idea, of course.
I have spent quite a bit of time on the IRS site and just cannot find the
information I'm looking for. But since you have done it yourself, you're
a first-hand expert! Keep up the wonderful work, always enjoy your newsletter!
Brenda in San Jose, CA
Hi Brenda,
Thanks for the warm note.
When I was temp-ing, it was so long ago, that the income was relatively
low - and my mortgage quite high, so I never had to deduct employee business
expenses on my tax return. Although, for the time, I was earning more than
most people my age with full-time jobs.
In your case, knowing the deductions will make a difference. One of the
reasons you aren't finding a lot of specifics on the IRS.gov site is that
I don't think IRS wants to address this head-on. (Just wait, when this gets
published, we'll be hearing from them, uh oh!)
It's still kind of a gray area. If you're temping long-term, IRS could choose
to look at this as your real job. Then, all your mileage would be considered
commuting - which isn't deductible.
I don't think that's reasonable. Essentially, in my view, if you're a temp,
your office is the company's headquarters. When you go there, that's commuting.
When you go anywhere else, I feel that this is business mileage.
So track all the miles to and from your assignments. Track your total miles
on your vehicle. And keep records of all your auto expenses, including parking,
car washes, service, repairs, etc.
You'll be reporting these expenses on Form
2106, the Employee Business Expense Form.
The total will carry over to Schedule
A, line 20 as unreimbursed employee expenses in the Miscellaneous deductions.
What else can you deduct besides auto expenses? Well, you need a cell phone
to stay in touch with your service. And you'll need an appointment book or
other supplies of your own that you may want to carry with you at all times.
It's a pity that the agencies don't mandate a uniform (a well-designed one,
of course). It would making knowing what to wear so much easier. And, the
wardrobe would be deductible.
Don't deduct costs for meals unless you work away from home overnight. In
which case, the agency would probably reimburse you anyway.
Certainly, you'll be able to deduct gifts of up to $25 per person per year
- things you give folks at your temp agency or at your client companies.
As to anything else? Look at each expense you incur. If you really believe
that's specifically related to your job, write down why on the back of the
receipt (or a note pad) and take the deduction.
The key is always to be able to explain why you do anything. And as a temp,
you're already pretty good at that.
Best Wishes,
Eva Rosenberg, MBA, EA
