Whether you use public transportation out of necessity or convenience (or both), you’ll typically enjoy a savings over driving and maintaining your own vehicle. But you may realize even more of a savings when you file your tax return. Even though all public transportation costs do not qualify as tax deductions, the IRS considers many of these costs legitimate ways to reduce your tax liability.
The IRS allows you to claim various public transportation costs as deductions on your income tax return. The only caveat is that these costs must meet IRS mandated guidelines which dictate the specific expenses that are eligible for deduction.
Claim Public Transportation Tax Deductions
IRS Publication 463 (Travel, Entertainment, Gift, and Car Expenses) lists allowable public transportation tax deductions for business-related expenses. If you are self-employed and your job includes traveling, you can claim deductions for the costs of public transportation that are necessary for your job. You cannot claim a deduction for your spouse who travels with you unless your spouse is your employee or also has a legitimate reason for business travel, and you file a joint tax return.
IRS Publication 502 (Medical and Dental Expenses) lists allowable deductions for public transportation costs that you incur for medical care. For example, you can claim transportation expenses for traveling to medical professionals for diagnosis and treatment for illnesses, which include both physical and mental illnesses. If your child is going for a diagnosis or treatment, you can also claim your transportation expenses if you accompany your child. And you can even claim a deduction for traveling by public transportation to visit a mentally ill dependent, as long as a medical professional has recommended your visits as part of the dependent’s treatment.
Public Transportation Tax Deduction Exceptions
- For tax purposes, “business” travel does not include commuting to and from your job – this is not an allowable deduction. If you have more than one job, you can deduct the transportation costs between each workplace, such as the cost from your primary job directly to a part-time job, but you cannot claim the cost of traveling home from a job.
- If your employer reimburses you for business-related transportation costs, you cannot also claim this as a deduction.
- If your medical insurance provider reimburses you for transportation expenses, you cannot claim these costs as a deduction.
2018 Public Transit Tax Deductions
Non-reimbursed employee expenses are no longer allowed as deductions on your tax return beginning with the 2018 tax year. If performing your job includes business-related transportation costs, your employer must reimburse you or you will lose the money you spend for any out-of-pocket transportation costs.
List non-reimbursed transportation costs related to your medical care on Line 1 of Schedule A, which is part of your 1040 tax return.
2017 Public Transit Tax Deductions
The year 2017 marked the last year that employees can claim non-reimbursed business expenses as deductions on their income tax returns. For the tax year 2017, you'll itemize your non-employer-reimbursed public transportation costs on Line 2 of Form 2106 (Employee Business Expenses). Attach Form 2106 to Schedule A, which is part of your 1040 tax return. You may also use Form 2106-EZ, but refer to the instructions on both forms to determine if you can file this form instead of Form 2106.
Victoria Lee Blackstone was formerly with Freddie Mac’s mortgage acquisition department, where she funded multi-million-dollar loan pools for primary lending institutions, worked on a mortgage fraud task force and wrote the convertible ARM section of the company’s policies and procedures manual. Currently, Blackstone is a professional writer with expertise in the fields of mortgage, finance, budgeting and tax. She is the author of more than 2,000 published works for newspapers, magazines, online publications and individual clients.