away from home expenses

[Kram BergGold]

In 2005 and 2006 my client did not work in the area he lives in. In 2007 He has $120k of income from local real estate, $50,000 of investment income and $80,000 of Schedule C income. The Schedule C income was earned in two locations, one 50 miles away and the other 400 mi away. To me he is an itinerant worker, no tax home, and as such he can't claim any travel or meals deductions. However, I was wondering if the $120,000 of rental income gives him a tax home and therfore the Schedule C travel becomes deducible.

[travis bickle]

you will need to look at

In 2005 and 2006 my ""client did not work in the area he lives in. In 2007 He has $120k of income from local real estate, $50,000 of investment income and $80,000 of Schedule C income. The Schedule C income was earned in two locations, one 50 miles away and the other 400 mi away. To me he is an itinerant worker, no tax home, and as such he can't claim any travel or meals deductions. However, I was wondering if the $120,000 of rental income gives him a tax home and therfore the Schedule C travel becomes deducible.

several factors.

Take a gander at Tax Topic 511 at the IRS website [ http://www.irs.gov/taxtopics/tc511.html ]. When you read that, you will notice that the service says "time at a location is the most important consideration" [NOT the amount of money from a source] and "did the taxpayer realistically expect to be working there more than one year" [LOL - they never do - LOL].

Based on your client's overall situation on several points, he may or may not have a tax home; you are the only one who can determine that once you examine the pertinent details from your client.

[OtisMozzetti]

Is there a place where MAIN place of work or business is?

Does he have a TAX HOME? Is there a place where his MAIN place of work or business is located? Maybe so. Depending on HOW he earns the bigger bucks from real estate, the local area (where he also lives, and possibly spends a lot of work and business time) MAY be his main place of business. Also, one or the other places where Schedule C work (his own business) is carried out might be THE MAIN place of his work or business.

= = = = = = =
We all know it is not for us to ask "why"? Nor is it for us to say "it isn't fair!" Yet, does all this seem like a sensible, practical, and equitable way to define our tax laws and regulations? <COL...COL>

[solomon]

From Burski vs Commissioner - note the exception. A pro se however.

For income tax purposes, the term “home” in section
162(a)(2) means a taxpayer’s principal place of business and not
where the taxpayer’s personal residence is located, if different
from the principal place of business. Barone v. Commissioner, 85
T.C. 462, 465 (1985), affd. without published opinion 807 F.2d
177 (9th Cir. 1986); Mitchell v. Commissioner, 74 T.C. 578, 581
(1980); Daly v. Commissioner, 72 T.C. 190, 195 (1979), affd. 662
F.2d 253 (4th Cir. 1981); Kroll v. Commissioner, 49 T.C. 557,
561-562 (1968).

An exception to the rule exists when a taxpayer
accepts work away from the taxpayer’s personal residence and the
work is temporary rather than indefinite. Peurifoy v.
Commissioner, 358 U.S. 59, 60 (1958). Under this exception, a
taxpayer’s tax home becomes the vicinity of the taxpayer’s
primary personal residence in a real and substantial sense. Id.;
see Deamer v. Commissioner, T.C. Memo. 1984-63, affd. 752 F.2d
337 (8th Cir. 1985); Rohr v. Commissioner, T.C. Memo. 1982-117.

[snowbird]

I don't think you given enough detail to know if the person has a tax home ... these expenses maybe major ... Pub 17 page 169 provides some guidance .

Factors used to determine tax home. If you do not have a regular or main place of business or work, use the following three factors to determine where your tax home is.

1. You perform part of your business in the area of your main home and use that home for lodging while doing business in the area.

2, You have living expenses at your main home that you duplicate because your business requires you to be away from that home.

3. You have not abandoned the area in which both your historical place of lodging and your claimed main home are located; you have a member or members of your family living at your main home; or you often use that home for lodging.


If you satisfy all three factors, your tax home is the home where you regularly live. If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses.


Do the tp keep an office at his home location and works out of it planning jobs... etc