20.2 Commuting Expenses
The cost of travel between your home and place of work is generally not deductible, even if the work location is in a remote area not serviced by public transportation. Nor can you justify the deduction by showing you need a car for faster trips to work or for emergency trips. Travel from a union hall to an assigned job is also considered commuting. If you join a car pool, you may not deduct expenses of gasoline, repairs, or other costs of driving you and your passengers to work.
According to the IRS, if you use your cell phone to make calls to clients or business associates while driving to your office, you are still commuting and your expenses are not deductible. Similarly, the deduction is not allowed if you drive passengers to work and discuss business.
Court Decision
Deductible commuting expenses.
The IRS allows these exceptions to its blanket ban on commuting expense deductions.
If you are on a business trip out of town, you may deduct taxi fares or other transportation costs from your hotel to the first business call of the day and all other transportation costs between business calls.
If you use your car to carry tools to work, you may deduct transportation costs where you can prove that they were incurred in addition to the ordinary, nondeductible commuting expenses. The deduction will be allowed even if you would use a car in any event to commute; see the Examples below.
Commuting to a temporary place of work.
Whether you can deduct commuting expenses to a temporary place of work may depend on the location of the temporary assignment and whether you have a regular place of business or a home office that is your principal place of business. According to the IRS, if you have a regular place of work outside of your home, or you have a home office that is your principal place of business, you may deduct the cost of commuting between your home and a temporary (see below) work location, regardless of where the temporary location is. If you do not have a regular place of work but normally work at several locations in the metropolitan area where you live, you may deduct the costs of commuting to a temporary location that is outside that metropolitan area, but not to a temporary location within the metropolitan area.
If you do not have a regular place of work and all of your jobs are outside the metropolitan area where you live, none of your commuting costs are deductible under the IRS rule. In one case, a commuting cost deduction was denied to an iron worker who lived in Yuba City, California, and who obtained temporary work assignments at a union hall in Sacramento, 40 miles from her home. All of the temporary jobs were in or near Sacramento. The Tax Court agreed with the IRS that none of her commuting costs to the temporary locations were deductible because she did not work in the Yuba City area where she lived. Since all of her assignments were in other cities, her decision to live in Yuba City was for personal, not business, reasons.
Caution
What is a temporary place of work?
A temporary work location is one at which your employment is realistically expected to last, and actually does last, for one year or less. If at first you realistically expect an assignment to last for no more than one year but that expectation changes, the IRS will generally treat the employment as temporary until the date that it became realistic to expect that the work would exceed one year.
Accountants, architects, engineers, and other professionals often have to travel to job sites of their clients. If such work at the site is temporary and they can show they also have a regular work office, they may deduct commuting expenses from their homes to their work sites.