Deductibility of Self-Employed Commuting Expense

by Jeffrey Joyner

If you are self-employed, you report your business income and expenses on Form 1040, Schedule C. Vehicle expenses, in some cases, may be among the expenses you can report on Schedule C. The Internal Revenue Service has specific guidelines that determine whether the cost of commuting is a personal or business expense. Whether you may deduct your commuting expenses depends on the circumstances of your commute.

General Guidelines

Your commuting expenses must be necessary, appropriate and common for your industry. You may use either your actual expenses or the standard mileage rate, which was 51 cents from Jan. 1 to June 30, 2011, and 55.5 cents from July 1 to Dec. 31, 2011. If you claimed a section 179 deduction on your vehicle or depreciated it using any method other than the straight-line method, you must use your actual expenses.

Commuting to a Regular Place of Business

If you have a place of business, such as a store or office, you cannot deduct your costs to commute between your home and your place of business. If you leave your regular place of business to call on clients, you may deduct your commuting expenses for the miles you drive in the course of making those calls.

Commuting from a Home Office

If you work out of a home office and have no regular place of business, you may deduct your commuting costs between your home office and a client's location. You may also deduct commuting costs for traveling from client to client if you call on more than one customer during the course of the day.

No Home Office or Place of Business

If you do not have a home office or a regular place of business, you may not deduct your commuting costs between home and your first client contact of the day nor between your last client contact of the day and your home. You may deduct commuting costs for your travel between your first business contact and subsequent business contacts during the day.

Temporary Work Location

If you have a regular place of business but must commute to a client's location on a temporary basis, you may be able to deduct your commuting costs between your home and the temporary location. You must reasonably expect the assignment to last no more than 12 months. However, if you have neither a home office nor a regular place of business, you may only deduct your commuting costs if the temporary location is beyond the metropolitan area, including suburbs, in which you normally work.

Client Reimbursements

Your client may reimburse you in full or in part for your expenses, or you may bill him for these expenses. Under either scenario, you cannot deduct for commuting expenses he pays. If the client's reimbursement does not exceed the amount you could claim, you may deduct the difference. For example, if your client reimburses you at 50 cents per mile, you may deduct an additional 5.5 cents per mile if the standard rate is 55.5 cents per mile.

Parking and Tolls

Regardless of whether you use the standard mileage rate or your actual expenses, you may deduct parking and tolls in addition to your vehicle expenses. You cannot deduct for parking at your regular place of business or tolls paid during a commute for which you cannot deduct the costs. For example, if you pay a toll to commute between your home and your regular place of business, you cannot deduct the cost. However, if you pay a toll to travel from your regular place of business to your client's location, you may deduct the cost.

About the Author

Jeffrey Joyner has had numerous articles published on the Internet covering a wide range of topics. He studied electrical engineering after a tour of duty in the military, then became a freelance computer programmer for several years before settling on a career as a writer.

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