100 Miles

Today TaxMama hears from Becky in Arlington TX who says, “I teach school and teach on a contract basis and my husband has a remodeling business. I want to know if my husband and I have our residence in one city, but commute 100 miles during the week to work in another city, can we deduct cost of our motor home’s interest, and the cost of a rental space to stay during the week, and the cost of returning from our place of business during the weekend.“

Sorry Becky, Uh, no.

Unfortunately, the fact that you chose to live 100 miles away from your job is your own choice. Even if there’s no work locally. Congress isn’t up to subsidizing that.

You can only get to deduct those kinds of travel deductions if the job is temporary. It has to be spelled out in writing that you have a short-term employment contract, with a definite termination date; or that you are being paid as a temp; or that you have a contract as with a specific end date and no automatic renewal clause… You’re starting to get the picture?

Even if you did have those contracts to back you up, you’d have a difficult time writing off more than one year’s worth of travel to a specific remote job location. Once that contract lasts more than a year…it’s no longer temporary.

If you really consider this temporary – and you truly believe that you will find a way to work in your own community in some foreseeable future, it’s worth the price to consult with a good local tax pro. They can help you structure your documentation to prove that this is temporary. That you have no choice but to travel because (and here you explain why there are no jobs in your community now). Then, explain why you have a reasonable expectation that there will be jobs again – and when.

Do your research. Put the information in the file and be prepared to present it to IRS when you’re audited. And you will be. It will be up to you to prove why this is temporary – if you’re still there 2 or three years from now.

I just went through this with a client. He lost his marketing job during the big layoffs in the beginning of this century. There were no jobs in his town. So he accepted a position in another state to teach, and to build his teaching skills. He was gone for one school year – that’s two tax years. We knew he’d get audited, so he kept meticulous records. But he didn’t have a copy of the contract. We almost lost all his travel expenses because of that one piece of paper. Once we got a copy from the university – IRS accepted all his expenses.

And remember, you’ll find answers to questions about commuting and all kinds of tax issues, free. Where? Where else? At TaxMama.com

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