Tax Question! Transportation expenses (credit, home, contractor)

[simplelyfe]

Hi everyone!

I live in Brooklyn and work in Jersey City.
One of my friends told me that I can deduct my transportation costs since I live in NY and work in NJ.
Is this true? I can't seem to be able to find any information online.

Thanks!

[Viralmd]

No! That's absolutely NOT true!!! A red flag for audit!

[mathjak107]

dosnt matter if you commute from the moon, your costs of going to and from work are never deductable.. perhaps if you owned a business you can expense them ....

[cjma79]

Originally Posted by simplelyfe

Hi everyone!

I live in Brooklyn and work in Jersey City.
One of my friends told me that I can deduct my transportation costs since I live in NY and work in NJ.
Is this true? I can't seem to be able to find any information online.

Thanks!

Like everybody else have said, the answer is no.
The only way you can deduct transportation is if is part of your work duty.
If your job has to do with driving around NYC then it would be tax deductible, but usually the company pays for this so even if your part of work is driving you wont be able to use it since you actually didn't paid it, the company on the other hand will use it as a tax deductible.

[NYStew]

If you are an independant contractor....yes.

[UpstaterInBklyn]

Originally Posted by NYStew

If you are an independant contractor....yes.

Absolutely true.

If you are a payroll employee... no. But as an independent contractor you are essentially running your own business so all work-related transportation (regardless of state lines) is deductible as a legitimate business expense. You must keep very detailed records of every trip, however! If it is by car, you should note the beginning and ending odometer reading for every trip.

[DesiArnez6]

Sure about that everyone? I thought I heard something on the news about Chuck Schumer sticking in something in the Stimulus Bill similar to that, transportation tax deduction or someting. But I think you actually have to live in NY instead of NJ.

Or maybe It was that its deducted from your payroll, AND THEN you are taxed, which would only save you part of the cost.

Not quite sure myself. maybe its some sort of reimbursement issue due to taxation from both states?

[cjma79]

Originally Posted by DesiArnez6

Sure about that everyone? I thought I heard something on the news about Chuck Schumer sticking in something in the Stimulus Bill similar to that, transportation tax deduction or someting. But I think you actually have to live in NY instead of NJ.

Or maybe It was that its deducted from your payroll, AND THEN you are taxed, which would only save you part of the cost.

Not quite sure myself. maybe its some sort of reimbursement issue due to taxation from both states?

I am 100% sure, it is only tax deductible if you are going from business to business travel IRC section 162(a)and a independent contractor that wants to do it has to have a home office and for that home office to qualified must be the taxpayer's principal place of business, or main office
IRC section 280A(c)(1)(A) so not all independent contractor can deduct their travel expenses from home if they actual work office is in the company that contracts him.

home office qualified as the taxpayer's principal place of business under

[DesiArnez6]

What about this?

TransitChek® Information for Employees from TransitCenter® (http://www.transitcenter.com/employees/ - broken link)

Senator Charles E. Schumer

... Just read it further, It looks like what It does is decrease your taxable income level by your transportation costs, which is technically a tax deduction right? And it seems that all MTA Riders are eligible from what I read. I didn't read it completely yet, And I dont know if New Jersey Transit is affected.

So, It looks like your company would have to sign up for the program, In turn, your transportation costs up to $230 per month can be deducted from your paycheck, Then your taxes / payroll taxes are calculated based on your income After your transportation deduction, and then the IRS considers your Income after that deduction for yearly tax purposes.

If I understand this correctly, It would definitely help upper income and middle income earners, but could adversely affect those that depend on the Earned Income Tax Credit and can't have their income go to "low" thereby reducing their refund.

[cjma79]

Originally Posted by DesiArnez6

What about this?

TransitChek® Information for Employees from TransitCenter® (http://www.transitcenter.com/employees/ - broken link)

Senator Charles E. Schumer

... Just read it further, It looks like what It does is decrease your taxable income level by your transportation costs, which is technically a tax deduction right? And it seems that all MTA Riders are eligible from what I read. I didn't read it completely yet, And I dont know if New Jersey Transit is affected.

So, It looks like your company would have to sign up for the program, In turn, your transportation costs up to $230 per month can be deducted from your paycheck, Then your taxes / payroll taxes are calculated based on your income After your transportation deduction, and then the IRS considers your Income after that deduction for yearly tax purposes.

If I understand this correctly, It would definitely help upper income and middle income earners, but could adversely affect those that depend on the Earned Income Tax Credit and can't have their income go to "low" thereby reducing their refund.

The program is basically that your employer pays for it using your money.
You go the your employer and ask him to deduct 280 dollars from your paycheck, then he gives you a card or a voucher for the money.