Mileage outside metropolitan area

[Gretel]

I just browsed through some of the posts on this subject and find myself confused again.

Lets assume home qualify as tax home and you travel every day to a temporary job outside your metropolitan area. This its deemed to be deductible, right?

On the other hand, if you are far enough away and have to stay overnight at the temporary job site than only the first and last trip are deductible (let's leave the limit on home trips aside here).

Why can you deduct ALL mileage if you don't stay overnight but are limited if you stay overnight? What am I missing?

[Golden Rocket]

Not a Good Answer

...of course, but I believe this to be the answer. And there is NOTHING in this answer that will appeal to common sense.

It's like you have to be wired to socio-political thinking. The government considers commuting to be a personal cost and not a cost of generating revenue. For those of us who have to drive to work, we know differently, but the government simply does not want to subsidize peoples commuting expenses. So they have gone to great lengths to deny it, with such concepts as "tax home" and "general metropolitan area."

They cannot deny legitimate travel expense, so they have to set a demarcation somewhere. And that "somewhere" is the overnight stay. This scenario holds true until someone rents an apartment in the destination town and then a whole new set of rules apply.

So a resident from Roundup MT can drive 50 miles to Billings and spend the night, and deduct not only his mileage but also his motel. Another resident could drive 150 miles to Bozeman and back every day, and not be able to deduct a penny.

[Gretel]

...of course, but I believe this to be the answer. And there is NOTHING in this answer that will appeal to common sense.

It's like you have to be wired to socio-political thinking. The government considers commuting to be a personal cost and not a cost of generating revenue. For those of us who have to drive to work, we know differently, but the government simply does not want to subsidize peoples commuting expenses. So they have gone to great lengths to deny it, with such concepts as "tax home" and "general metropolitan area."

They cannot deny legitimate travel expense, so they have to set a demarcation somewhere. And that "somewhere" is the overnight stay. This scenario holds true until someone rents an apartment in the destination town and then a whole new set of rules apply.

So a resident from Roundup MT can drive 50 miles to Billings and spend the night, and deduct not only his mileage but also his motel. Another resident could drive 150 miles to Bozeman and back every day, and not be able to deduct a penny.

Thanks Rocket, although I think it doesn't really answer the scope of my question.

It's not so much about the distance or overnight stay for that matter, as it is about tax home and temporary assignment. If taxpayer's home is qualified as tax home, then all travel outside his metropolitan area (whatever that might be) is considered travel expense as long as it is to a temporary job.

What I don't understand is why the same measurement does not apply if and when T/P stays overnight. Why the travel expenses are limited in that case. Maybe just because congress says so??

[New York Enrolled Agent]

It's not so much about the distance or overnight stay for that matter, as it is about tax home and temporary assignment. If taxpayer's home is qualified as tax home, then all travel outside his metropolitan area (whatever that might be) is considered travel expense as long as it is to a temporary job.

What I don't understand is why the same measurement does not apply if and when T/P stays overnight. Why the travel expenses are limited in that case. Maybe just because congress says so??

Why do you say the travel expense is limited in an overnight stay? Perhaps I miss your point but it seems you are confusing transportation expense with travel expense. Can you explain this a little more.

[Gretel]

Why do you say the travel expense is limited in an overnight stay? Perhaps I miss your point but it seems you are confusing transportation expense with travel expense. Can you explain this a little more.

I was taking about the limitations for home trips. Travel expenses are only allowed up to the amount it would have cost to stay overnight plus per diem.

Maybe exactly this is the reason why daily driving expenses to a temporary job outside the metropolitan area are fully allowed since there are no other costs that could limit the deduction.

[ChEAr$]

Remember also

that a house is not a home is not a home.

IOW, "tax home" does not refer to one's actual personal residence; rather to the general
locale in which one usually works.

[Kram BergGold]

Explanation

I had to read your post twice to understand your question. Your client goes 400 miles away and rents a room for 1 month. You deduct the first and last trip plus meals and lodging.
Now let's say he stays in a hotel. Every weekend rather than pay the cost of a hotel he travels home. In this case he gets to deduct the lower of the what the hotel cost and meals would ahve been or the travel home.
Basically, you can't take both the lodging and meals and the travel home. This makes sense.

[Bees Knees]

I'm not sure it does make sense. All travel to temporary locations within the metro area are deductible, but only the first and last trip to a temporary location outside the metro area is deductible.

That doesn't make sense. But those are the rules.

But then, tax rules aren't suppose to make sense.

And in fact, there are all kinds of rules that don't make sense.

Trying to make sense will drive you crazy.

You will sleep better at night if you understand that basic truth about tax laws. Making sense out of tax rules will drive you crazy. Therefore, stop trying to, and just follow the rules.

[New York Enrolled Agent]

I'm not sure it does make sense. All travel to temporary locations within the metro area are deductible, but only the first and last trip to a temporary location outside the metro area is deductible.

That doesn't make sense. But those are the rules.

Bees

Have you over simplified your answer? I'm having trouble with your post and the holdings in Rev Ruling 99-7. Are we talking about the same original post by G.?

(1) A taxpayer may deduct daily transportation expenses incurred in going between the taxpayer's residence and a TEMPORARY work location OUTSIDE the metropolitan area where the taxpayer lives and normally works. However, unless paragraph (2) or (3) below applies, daily transportation expenses incurred in going between the taxpayer's residence and a TEMPORARY work location WITHIN that metropolitan area are nondeductible commuting expenses.
(2) If a taxpayer has one or more regular work locations away from the taxpayer's residence, the taxpayer may deduct daily transportation expenses incurred in going between the taxpayer's residence and a TEMPORARY work location in the same trade or business, regardless of the distance. (The Service will continue not to follow the Walker decision.)
(3) If a taxpayer's residence is the taxpayer's principal place of business within the meaning of section 280A(c)(1)(A), the taxpayer may deduct daily transportation expenses incurred in going between the residence and another work location in the same trade or business, regardless of whether the other work location is REGULAR or TEMPORARY and regardless of the distance.

[JG EA]

Gabriele

Don't forget your can take computing expenses to outside the area, but only up to what it would have cost you to remain in the temporary location.

[Bees Knees]

Bees

Have you over simplified your answer? I'm having trouble with your post and the holdings in Rev Ruling 99-7. Are we talking about the same original post by G.?

I was being a bit sarcastic. I was referring to this rule, from page 4 of IRS Pub 463:

Going home on days off. If you go back to
your tax home from a temporary assignment on
your days off, you are not considered away from
home while you are in your hometown. You
cannot deduct the cost of your meals and lodg-
ing there. However, you can deduct your travel
expenses, including meals and lodging, while
traveling between your temporary place of work
and your tax home. You can claim these ex-
penses up to the amount it would have cost you
to stay at your temporary place of work.
If you keep your hotel room during your visit
home, you can deduct the cost of your hotel
room. In addition, you can deduct your ex-
penses of returning home up to the amount you
would have spent for meals had you stayed at
your temporary place of work.

So if I don’t stay at a hotel room and I simply travel back and forth to the temporary assignment, I deduct all costs of traveling back and forth.

But if I rent a hotel room and decide to travel home on days off, my travel expenses to go home are limited to the amount it would have cost me to stay at the temporary place of work.