If you regularly drive to and from your job, you feel the impact in your budget of the cost of gasoline, parking, automobile maintenance and related costs of commuting. Unfortunately, in most cases, you may not deduct expenses related to driving to work. However, under specific circumstances you may deduct these costs on your federal income tax return if you properly document your expenses. Consult with an attorney who specializes in tax law with specific questions concerning your work-related driving expenses.
Costs related to your daily commute are usually not tax deductible. The distance between your home and your workplace has no bearing. For instance, if you live in Geneva, a western suburb located approximately 50 miles away from Chicago, and drive every day to your office located downtown in the Loop, the Internal Revenue Service would not allow you to deduct your commuting costs.
Your Tax Home
The IRS generally does not allow deductions for driving to and from work within what it calls your tax home. The location of your tax home is your regular place of business, which sometimes differs from your residence. For instance, if you are a sales professional whose family home is in Chicago, but you live and work 10 months of the year in your company's main office in Indianapolis, the IRS considers Indianapolis your tax home. None of your commuting costs within Indianapolis are deductible. However, the IRS would allow you to deduct expenses related to traveling between Indianapolis and Chicago for the two months that you work there.
Multiple and Temporary Work Locations
If your employer temporarily assigns you to a different office, you may deduct the costs of driving between your home and the location of the temporary assignment. According to the IRS, a temporary assignment is an assignment that you reasonably believe will last one year or less. You may deduct these expenses whether the location of the temporary assignment is inside your tax home or located elsewhere. Likewise, you may also deduct costs related to driving between two or more work locations within your tax home.
Self-Employment Driving Expenses
As a self-employed worker who works primarily from home, you may deduct the costs of travel between your home and a work assignment located in a client's office or plant. Likewise, if you work in an office outside your home and regularly drive to work with clients or customers located outside your office, you may deduct the cost of travel between your office and wherever your clients are located. However, in the latter case, the IRS would not allow you to deduct the costs of travel between your home and your office.
- IRS.gov: Publication 463 (2010) -- Travel, Entertainment, Gift and Car Expenses -- Transportation
- IRS.gov: Topic 511 - Business Travel Expenses; February 2011
- IRS.gov: Deducting Business Expenses; June 2011
- IRS.gov: Publication 463 (2010) -- Travel, Entertainment, Gift and Car Expenses -- Travel
- Consulting Mentor: Deducting Mileage of Your Commuting Mileage Expense
- Bankrate.com; Transportation Tax Deductions; George Saenz; May 2008
- "Entrepreneur"; How to Deduct Your Vehicle Expenses; Bonnie Lee; July 2009
- Goodshoot/Goodshoot/Getty Images