Another TAX question...

[paysensmom]

I moved to another town (4 hours away from my husband) to take a teaching job since I could not get one where we lived. We own a house in this town as well so it worked out. I am wondering if I can write off any of our living expenses for the second house since I moved here for a job?
On paper it is going to look like we made a lot of money this year compared to last year. But this year we had TWO of every house bill! I pay half of my paycheck to the bills for this house alone. Not to mention the 4 hour drive every other weekend, we take turns.

Anybody have any advice?
Thanks so much

 

[minnie1928]

My gut reaction is that you can't deduct as much as your hoping. Assuming you're 2nd house is financed, have you been deducting the interest each year?

Beyond that, I don't think you can really deduct much more. We relocated in 2008. DH spent 6 months in NJ while we were in PA. He drove back and forth on weekends, employer paid 3 months of housing, we paid the remaining 3 months. Of those six months, we couldn't deduct anything. The only things we could deduct was the cost of moving (movers, but again the employer paid for it) and the mileage incurred by our cars when we moved.

 

[Cheshire Figment]

Other than mortgage interest and property taxes you have no additional allowable deductions. The cost of travel between the two homes is not business-related travel and is not deductible. Basically you have a primary residence and a secondary residence.

Mike (CPA Retired)

 

[wdwfan16]

I do not know about the two houses but I know you cannot deduct your mileage. The IRS will say that you CHOSE to move away from your family and thus it is not a temporary job and will not let you write off any job expenses.

 

[paysensmom]

aw man

 

[Blue.Fairy2]

Other than mortgage interest and property taxes you have no additional allowable deductions. The cost of travel between the two homes is not business-related travel and is not deductible. Basically you have a primary residence and a secondary residence.

Mike (CPA Retired)

Yes she does so travel to & from the second residence, which is also where she works, to the primary residence would be deductible.

I think the tax deductibility of this is debatable.

http://www.irs.gov/publications/p463/ch01.html

http://www.ehow.com/how_2067516_make-travel-expenses-tax-deductible.html

not a former CPA.

 

[wdwfan16]

Yes she does so travel to & from the second residence, which is also where she works, to the primary residence would be deductible.

I think the tax deductibility of this is debatable.

http://www.irs.gov/publications/p463/ch01.html

http://www.ehow.com/how_2067516_make-travel-expenses-tax-deductible.html

not a former CPA.

The former CPA is correct on this.

 

[SandrA9810]

what about filing seperatly?? would that make a difference?

 

[wdwfan16]

what about filing seperatly?? would that make a difference?

No

 

[minnie1928]

The former CPA is correct on this.

I agree, I'm not a CPA but I am an accountant.

 

[Blue.Fairy2]

Once you have determined that you are traveling away from your tax home, you can determine what travel expenses are deductible.

You can deduct ordinary and necessary expenses you have when you travel away from home on business. The type of expense you can deduct depends on the facts and your circumstances

Her Tax home is the home she shares with her husband. I am not saying she can deduct all food, electric etc for the home near her school but I do believe she can deduct travel expenses to and from and 1 meal each way.

I would recommend talking with a good tax attorney it may be worth your while.

Tax Home



For job-related travel expenses, you must be traveling away from your tax home. The following guidelines clarify where your tax home is considered to be:



Generally, your tax home is the regular place of business or post of duty, regardless of where you maintain your family home. The tax home includes the entire city or general area of your place of business.
If you have more than one regular place of business, your tax home refers to your main place of business.
If you have no main place of business because of the nature of your work or the circumstances, your tax home may be the place where you regularly live or where your main home is located. Use the following to determine whether your main home can be considered your tax home:
You perform part of your business close to your main home and you use that home for lodging while doing business in the area.
You duplicate the living expenses you already have at your main home that you duplicate because your business requires you to be away from that home.
You have not abandoned the home in which have historically lived and considered your main home, you have members of your family living at your main home, or you often use that home for lodging.
If there is no place where you regularly live, your tax home is wherever you work. In this case, you cannot claim a travel expense deduction because you are never considered to be traveling away from home.

I would consider her job a temporary situation due to the state of the economy in her area. I am sure if a job opens up near her tax home( the one she shares with her husband) she will take that.

Temporary Travel

Temporary Travel


To have qualified job-related travel expenses, you can either be temporarily away from home or on a temporary assignment. You are considered to be temporarily away from home if your duties require you to be away from the general area of your tax home substantially longer than an ordinary day's work and you need to sleep or rest to meet the demands of your work while away from home.



You will generally be considered on a temporary assignment if you realistically expect it to last (and it does last) for one year or less.

 

[paysensmom]

oops

 

[Cheshire Figment]

First of all, the OP owns the house in the city where she is currently working.

Second is she has not been sent to that city by her employer. She chose to work there and was hired in that city.

If her employer was in the city of former residence, and where her husband still lives (and which she returns to on weekends, etc) and the employer sent her out of town she woiuld be "away from home on business" but she chose to work at that location. You are quoting from the regulations concerning if her employer had sent her which is not the situation here.

(And, by the way, I am not a "former" CPA, I am retired, drawing a pension, and still having an active income tax practice with over 20 clients and am still a CPA.)

 

[kaytieeldr]

Her Tax home is the home she shares with her husband. I am not saying she can deduct all food, electric etc for the home near her school but I do believe she can deduct travel expenses to and from and 1 meal each way.

I would recommend talking with a good tax attorney it may be worth your while.



I would consider her job a temporary situation due to the state of the economy in her area. I am sure if a job opens up near her tax home( the one she shares with her husband) she will take that.

Temporary Travel

Respectfully, I would heed the advice of the tax and financial professionals on this thread over the opinion of someone not trained in/not having experience with the legalities of filing income tax, allowable deductions, etc.

I'm saying this as someone in pretty much the same category as the quoted poster; I know my interpretation of tax laws doesn't count for much, especially in a case like the OP's. Just because I think a tax law/deduction applies in my case, doesn't make it so in the eyes of the IRS.

 

[Blue.Fairy2]

Respectfully, I would heed the advice of the tax and financial professionals on this thread over the opinion of someone not trained in/not having experience with the legalities of filing income tax, allowable deductions, etc.

I'm saying this as someone in pretty much the same category as the quoted poster; I know my interpretation of tax laws doesn't count for much, especially in a case like the OP's. Just because I think a tax law/deduction applies in my case, doesn't make it so in the eyes of the IRS.

and that is why I said to consult with a tax attorney.

 

[Claire&TheBoys]

I'm in agreement with the CPAs on this one. My husband is an Army Reservist, but also has a regular civilian job. His Reserve post is 2 hours away. We are allowed to claim the mileage and lodging we pay for out-of-pocket and a meal allowance because the Reserves is his 2nd job. Since the OP only has one job and could choose to live wherever she wants, she cannot deduct the mileage or expenses.

 

[Blue.Fairy2]

I'm in agreement with the CPAs on this one. My husband is an Army Reservist, but also has a regular civilian job. His Reserve post is 2 hours away. We are allowed to claim the mileage and lodging we pay for out-of-pocket and a meal allowance because the Reserves is his 2nd job. Since the OP only has one job and could choose to live wherever she wants, she cannot deduct the mileage or expenses.

I am not saying that the cpa is wrong, I am just saying that a lot of IRS code is open for interpretation and that maybe OP would want to contact a tax attorney to discuss her circumstances.

 

[kaytieeldr]

Respectfully, the only entity allowed to "interpret" the tax codes is the IRS - where interpretation indicates comprehending the tax rules in one's own favor to potentially avoid paying taxes. To be completely honest, they even have employees who can answer the OP's questions - free, via the toll-free number.

For that matter, the IRS returns overpayments (okay, granted, it probably cost them more to discover my error, then issue and mail the check, than the $1.00 refund I got...)

 

[PatsMom]

I have to agree with the retired CPA on this one! I really wish that travel expenses like the OP has could be deducted!