mileage revisited

[Unregistered]

Another direct seller issue were the recruiting consultant said "keep a mileage log and you can deduct all of your trips". If I recall correctly, unless you have an office in the home you cannot deduct your mileage to the hostess house?

This is some type of candle company were the seller will go to the house of the hostess, throw a party and the company will then mail all items to the clients, so most of the time there is one trip involved to the party and back home.

The recruiter of this direct seller said she does not have an office in the home and her CPA says all mileage is deductible.

[veritas]

I would ask the recruiter to get that in writing from the Cpa.

[JG EA]

Just a thought.

What about the provision of visiting with clients or customers? Pub 463 page 13. It is listed as a different item than a workplace issue.

[S T]

Info

Based on what I found

"You have no regular office and you do not have an office in your home. In this case, the location of your first business contact is considered your office. Transportation expenses between your home and this first contact are nondeductible commuting expenses. Transportation expenses between your last business contact and your home are also nondeductible commuting expenses. Although you cannot deduct the costs of these trips, you can deduct the costs of going from one client or customer to another."

Sounds Like "Party Lite" in which case similar to the Avon, Amway, etc.

The "recruiters or up-line will tell the "new or down-line" person anything relating to income/expenses and taxes. We all know that most of the time, the t/p is only involved in the activity less than 12 months, usually 2 tax returns and no more. Never any income, only expenses.

Sandy

In 25 years I have only seen one Avon person year in and year out, have sales and commissions. She was retired and actually did pretty well at it about $15,000 of supplemental income. Just now after about 3 years have had a client in "Creative Memories" that made it to Director and has down line activity. So she has finally achieved a "legitimate business" with some actual 1099 income and some legitimate write offs.

[JG EA]

Sandy

Based on what I found

"You have no regular office and you do not have an office in your home. In this case, the location of your first business contact is considered your office. Transportation expenses between your home and this first contact are nondeductible commuting expenses. Transportation expenses between your last business contact and your home are also nondeductible commuting expenses. Although you cannot deduct the costs of these trips, you can deduct the costs of going from one client or customer to another."

You are right of course. But what about this section in Pub 463? It is different that the normal workplace issues, isn't it? Notice the 2nd of "all of the following."

Pub 463: Chapter 4: "This chapter discusses expenses you can deduct for business transportation when you are not traveling away from home as defined in chapter 1. These expenses include the cost of transportation by air, rail, bus, taxi, etc., and the cost of driving and maintaining your car.

Transportation expenses include the ordinary and necessary costs of all of the following.

Getting from one workplace to another in the course of your business or profession when you are traveling within the city or general area that is your tax home. Tax home is defined in chapter 1.

Visiting clients or customers.

Going to a business meeting away from your regular workplace.

Getting from your home to a temporary workplace when you have one or more regular places of work. These temporary workplaces can be either within the area of your tax home or outside that area."

[S T]

More Pub 463

JG,

Good find on Pub 463, page 13, but if you read on to page 14, under No regular place of work, seems like it would be disallowed again, " If you have no regular place of work, but ordinarily work in the metro area where you live, you can deduct daily transportation costs between home and a "temporary" work site OUTSIDE that metro area. So maybe if outside the "Metro" area.

Then if you go to page 15, and look at Example # 3. "You have no regular office, and you do not have an office in your home. In this case, the location of your first business contact is considered your office. Transportation expenses between your home and this first contact is considered your office. Transportation expenses between your home and this first contact are non deductible commuting expenses. Transportation expenses between your last business contact and your home are also nondeductible commuting expenses. Although you cannot deduct the costs of these trips, you can deduct the costs of going from one client or customer to another."

Seems like in "UR" post the t/p would have to establish a Home Office in order for the mileage to be deductible from her home to the "Party". Next question, is what can t/p do to meet the guidelines of "Home Office".

Sandy

[JG EA]

Thanks

Should have kept reading.

JG