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You Got This Weekly Series: Can Work-Related Driving Expenses Be Deducted On My Tax Return?

You Got This - TaxACT

Each week we will answer one of the most frequently asked questions on FacebookTwitter and TaxACT’s Blog in the “You Got This” Weekly Series.

Question:

If I drive 65 miles one way to my job and have tolls to pay there and back, what is deductible on my taxes?

Hilary via Facebook

Response:

Many taxpayers don’t claim work-related expenses on their tax return simply because they aren’t sure which deductions qualify.

Expenses for fuel, parking, tolls, etc. can add up quickly. But how do you know which expenses can be claimed on your tax return?

In general these types of expenses can be broken down in two ways, travel expenses and commuter expenses.

Simply put, travel expenses would be directly related to your specific job. These expenses are incurred because of the work field you are in or are specific to your job description.

For example, after arriving at work you travel to meet with different clients throughout the day. During the course of the work day, you travel 50 miles and incur $5 in parking and tolls during your client visits.

These expenses would be deductible as travel expenses because they are directly related to your job.

Note: Some employers reimburse employees for work-related travel expenses. If you are reimbursed for your work-related travel expenses, you cannot claim them as a deduction on your tax return.

However, if you employer reports your reimbursement as wage income on your Form W-2, you are allowed to take these expenses as deductions.

On the other hand, commuter expenses are your normal everyday expenses incurred for driving to and from work. While these may seem like work-related expenses, the expenses you incur to get to work are not travel expenses. Once you are at work, any expenses for work-related travel would be deductible.

Let’s say you drive 50 miles to work every day roundtrip and pay $5 a day to park your car. These expenses are not directly related to your job description and therefore are not deductible as travel expenses.

In sum, the expenses you incur to get from home to work and work to home are not deductible as work-related expenses.

Once you arrive at work, any transportation expenses you incur over the course of a work day can be deducted as travel expenses if they are work-related.

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