Deducting Away-from-home Travel Expenses
There are three general criteria that must be met to deduct away from home travel expenses. Here are the 3 requirements with some details:
Employment must be temporary: the following factors may be relevant:
- work lasting more than one year is not temporary
- working lasting less than a year does not make the job temporary if the job is meant to last more than one year.
- an employer's classification of an employee as temporary is not conclusive.
- recurring and seasonal work may be seen as indefinite by courts.
- the determination of temporary status is generally made at the time of hire.
- all facts and circumstances are taken into account by courts.
Taxpayer must be away from tax home: the following factors may be important:
- taxpayer's tax home is generally the same as the taxpayer's area in which they work.
- if a taxpayer has more than one business, his tax home is where he spends most of his time or earns most of his income.
- a taxpayer that changes job locations for longer than one year changes tax home to the new job location.
- a taxpayer does not necessarily have a tax home to be away from.
- spouses can have different tax homes.
- a tax home is not necessarily where the rest of the taxpayer's family lives.
Expenses must be a deductible type. As follows:
- expenses must be directly related to to work of the taxpayer.
- expenses must be reasonable in amount.
- must be incurred while away from the tax home on business.
- must be ordinary for the business involved.
- the taxpayer may deduct temporary living expenses to minimize double costs.
- the taxpayer must be able to substantiate expenses.