33.16 Local Transportation and Travel Away From Home To Take Courses
If your courses meet the requirements in the preceding two sections (33.14, 33.15), costs of local transportation and travel away from home may be included in the business/job expense deduction.
Local transportation expenses.
If your courses qualify for a deduction under 33.15, you may deduct transportation costs of going from your job directly to school. Transportation costs include the actual costs of bus, subway, cab, or other fares, as well as the costs of using your car. According to the IRS, the return trip from school to home is also deductible if you are regularly employed and going to school on a temporary basis. According to the IRS, you are going to school on a temporary basis if your courses are realistically expected to last for one year or less and actually do last no more than one year. This is the same one-year test for determining whether you can deduct the cost of commuting to a “temporary” work location (20.2) or living costs while away from home on a “temporary” assignment (20.9). The IRS position is illustrated in the following Examples.
Using your car.
If you use your own car for transportation to school, you may deduct your actual expenses or use the standard business mileage rate to figure the deductible amount. The standard mileage rate for 2012 is 55.5 cents per mile. Whether you deduct the standard mileage rate or actual expenses, you may also deduct parking fees and tolls.
Travel and living expenses away from home.
“Away from home” has a special tax meaning (20.6). You are not away from home unless you are away overnight. If you are away from home to attend a qualifying course, you may deduct the cost of travel to and from the site of the course, plus lodging and 50% of meals while you are there.
Expenses of sightseeing, social visiting, and entertaining while taking the courses are not deductible. If personal reasons are your main purpose in going to the vicinity of the school, such as to take a vacation, you may deduct only the cost of the courses and your living expenses while attending school. You may not deduct the rest of your travel costs.
To determine the purpose of your trip, an IRS agent will pay close attention to the amount of time devoted to personal activities relative to the time devoted to the courses.
Is travel itself a form of education?
A teacher generally may not deduct the cost of an “educational” trip to another state or country as a job expense. Although a trip may have educational value in that the teacher learns about people, culture, or places related to the courses that he or she teaches, the IRS position is that a specific statute, Code Section 274(m)(2), bars a deduction for travel that is a form of education. There may be exceptions where specific research can only be accomplished at a particular location, but a trip for “general” educational purposes does not qualify according to the IRS.
The Tax Court took a different view of the statute in a decision that opens the door to a deduction for teachers who travel overseas to take highly organized courses with regular lectures, a structured syllabus, tours to historically and culturally relevant sites, and extensive reading assignments. The Court allowed a California high-school English teacher and department chair to deduct $5,334 for her airfare, lodging, meals, and tuition for an 18-day trip to Greece in 1995. She was also allowed to deduct $7,705 for a two-week trip to Southeast Asia in 1996. In Greece, she took a course on Greek myths and legends and on the Asian trip, a course on Buddhist and Hindu traditions. Her school required neither course. For the Tax Court, the key to the deduction was the organized nature of the courses, which were sponsored by the Berkeley extension program, taught by university professors, and qualified for undergraduate credit, although the teacher was not taking the courses for credit. The regular lectures, tours, and readings were focused educational activities, not the type of mere educational travel that Congress intended to make nondeductible. After holding that a deduction was not barred by Section 274(m)(2), the Court still had to find that the courses had the primary purpose of maintaining or improving the teacher’s skills, but it had little difficulty in doing so. The courses improved her teaching skills and helped her to develop curriculum. The courses on Asian traditions also helped her relate better to the predominantly Asian student population in her school. She spent most of her time attending courses and related programs and had minimal free time.