If you incur expenses related to your business, you may be able to deduct those expenses on your tax return. In previous articles, we touched on deductible business-related travel, entertainment, and vehicle expenses. This publication is focused on business-related transportation expenses.
For purposes of this article, transportation expenses refers to transportation for business purposes when you are not traveling away from home.
In general, transportation expenses include the following:
- Commuting from one workplace to another for your business when those sites are within the general area of your tax home.
- Visiting clients or customers.
- Attending a business meeting at a location other than your normal place of work.
- Commuting from your home to a temporary workplace when you have more than one place of work.
Transportation expenses can include expenses related to travel by airplane, bus, taxi, train, and car, as well as costs associated with maintaining a business vehicle.
Daily Transportation Expenses Non-Deductible
Typically, expenses associated with traveling from your home to one or more places of business are non-deductible, as such expenses are considered normal commuting expenses. However, there are exceptions when expenses for daily transportation are deductible:
- Expenses associated with transportation from your home to a temporary work location located outside of your tax home.
- Expenses when you have more than one normal work location.
- Expenses when your home is your normal work location and you must commute to another work location related to the same line of business.
No Regular Place of Work
If you have no regular place of work but normally work in the metropolitan area where you live, you can deduct transportation costs associated with traveling to temporary work location outside of that metropolitan area. A metropolitan area includes locations in the city limits, as well as suburbs of that location.
You cannot deducting transportation costs associated with transportation between your home and a temporary place of work within your metropolitan area.
Multiple Places of Work
If you have multiple places of work, you can deduct the cost of getting from one work location to another location. However, you cannot deduct the costs of any additional transportation for personal reasons while getting from one work location to another.
If you use your car for business purposes, you can deduct car expenses using one of the following two methods.
Actual Car Expenses
Actual car expenses allow you to deduct the portion of expenses related to maintaining and servicing your car based on what percentage of usage of your car pertains to business use. Car expenses include depreciation, gasoline, insurance, lease payments, maintenance, oil, registration fees, and repairs.
Standard Mileage Rate
The standard mileage rate allows you to deduct a flat amount per mile driven for a business purpose. For 2015, the standard mileage rate is 57.5 cents per mile.
You can elect to base your deduction for cars usage on the actual expenses or standard mileage rate, whichever provides you the greatest benefit. Whichever method you chose, you must use the method for the entire tax period.
Where can I get additional information about deduction of business-related gift expenses?
If you have additional questions about business-related transportation expenses or need help with your tax return, you should speak with a tax attorney. A tax attorney will have the training and experience to answer your tax questions and help file your tax return.
By completing the form below or calling the phone number located at the top of this page, you can get in touch with a tax attorney. Remember the initial discussion with a tax attorney is free of charge and all conversations with an attorney or protected by attorney-client privilege.
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Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.