topic As a department of transportation air traffic controller, how do I determine how much the total standard meal deduction is for the schedule C? in Deductions & credits

As a department of transportation air traffic controller, how do I determine how much the total standard meal deduction is for the schedule C?

mj0730 — Sat, 01 Jun 2019 04:43:59 GMT

Twincessna501: You're misreading "including meals incurr...

bwa — Sat, 01 Jun 2019 04:44:01 GMT

Twincessna501: You're misreading "including meals incurred while away from home on business." The Tax Court has held that "home" in the statute for travel expenses refers to your "tax home" which is the area in which you are principally employed. Notice the instructions for line 3 don't refer to your home, but your "tax home", which is defined in the next paragraph.

The IRS has been very clear in this position, including specifically with Air Traffic Controllers. See for example GENIN-155125-01 which specifically holds that in-town meals for an Air Traffic Controller are not deductible. It's at https://www.irs.gov/pub/irs-wd/02-0020.pdf

Well then the current 2106EZ guidance and IRS Pub 529 Mea...

twincessna501 — Sat, 01 Jun 2019 04:44:04 GMT

Well then the current 2106EZ guidance and IRS Pub 529 Meals when subject to “hours of service” limits section is published with errors. In the case of an aircraft dispatcher meals are consumed on duty, at your console while working with no break allowed due to FAA operational control regulations. It would seem those circumstances would meet the provisions of 247 (A)

Unfortunately, as noted in GENIN-155125-01, the IRS disag...

bwa — Sat, 01 Jun 2019 04:44:06 GMT

Unfortunately, as noted in GENIN-155125-01, the IRS disagrees. (I'm not convinced that the Form 2106 instructions are in error, but I will concede that they are certainly poorly written for this point.)

It's an urban myth that air traffic controllers can claim...

bwa — Sat, 01 Jun 2019 04:44:08 GMT

It's an urban myth that air traffic controllers can claim per diem. To be able to do so you must meet two conditions:

You must be a "DOT Employee". Air traffic controllers meet this criteria.
You must be away from the area in which you are principally employed, on business, overnight. They don"t usually meet that criteria.

You can use a special standard meal allowance if you work in the transportation industry and are away from your “tax” home, on business, overnight. The purpose of qualifying is to determine deductible travel expenses. From Internal Revenue Bulletin 2011-42, "This revenue procedure updates Rev. Proc. 2010-39, 2010-42 I.R.B. 459, and provides rules for using a per diem rate to substantiate, under § 274(d) of the Internal Revenue Code and § 1.274-5 of the Income Tax Regulations, the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. " Consequently, even if the position qualifies, it is meaningless unless the employee is eligible to claim meals and other subsistence expenses due to being away from their tax home (the area where they are principally employed). overnight, on business.

You are in the transportation industry if your work:

Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and
Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standfard meal allowance rates.

From TurboTax’s explanation at https://ttlc.intuit.com/questions/2541197

Work that doesn't directly involve moving people or goods doesn't qualify as a transportation industry job, even if the company you work for is in the transportation business. This excludes jobs like:

Mechanic;
Air traffic controller;
Firefighter;
Office worker (clerical, sales, management, engineering, etc.);
Assembly-line or manufacturing;
Employee (other than a vehicle operator or crew member) of an airline, railroad, trucking company, shipyard, etc.;
Working at a bus or train station, gas station, truck stop, harbor, or airport;
Cruise ships (their primary purpose is tourism as opposed to transportation).

In addition, transportation industry work requires that the employee regularly spends nights away from their tax home, which the IRS defines as the city or general area where you work, not just your physical dwelling. This eliminates jobs like:

· Transit worker;

· School bus driver;

· Taxi, limo, or shuttle driver;

· Chauffeur;

· Local truck driver (mail, delivery, garbage, mining, etc.)

· Paramedic or EMT;

· Helicopter, crop-duster, or bush pilot;

· Baggage handler or loading dock worker.

Looking at the instructions from the 2106-EZ It directly...

twincessna501 — Sat, 01 Jun 2019 04:44:10 GMT

Looking at the instructions from the 2106-EZ It directly names jobs and specifies that any meals consumed during DOT hours in service limits can be claimed. This affects airline flight dispatchers and air traffic controllers because we are on duty and sometimes in control of flights while consuming meals. I recommend using the GSA data and finding your local meal expense rate. Verify with your duty logs of the day you worked and if you should use the breakfast, lunch or dinner expense. Turbo tax will automatically apply the 80% calculation to your deduction if you selected you are a transportation employee. Copy of relevant 2016EZ instructions below:

Line 5.
Generally, you can deduct only
50% of your business meal and
entertainment expenses, including meals
incurred while away from home on
business. If you were an employee subject
to the DOT hours of service limits, that
percentage is 80% for business meals
consumed during, or incident to, any
period of duty for which those limits are in
effect.
Employees subject to the DOT hours of
service limits include certain air
transportation employees, such as pilots,
crew, dispatchers, mechanics, and control
tower operators; interstate truck operators
and interstate bus drivers; certain railroad
employees, such as engineers, conductors,
train crews, dispatchers, and control
operations personnel; and certain
merchant mariners.

Re: Looking at the instructions from the 2106-EZ It directly...

pilotchip — Sat, 04 Apr 2020 20:52:46 GMT

I think the main language to emphasize is: If you were an employee subject to the DOT hours of service limits, that percentage is 80% for business meals consumed during, or incident to, any period of duty for which those limits are in effect.

Which, for ATC would be 24/7 because you're recallable at any time, or at least during your entire shift. It looks like the 2017 revision is still the current version and the language hasn't changed.

Re: Looking at the instructions from the 2106-EZ It directly...

MaryK4 — Sat, 04 Apr 2020 21:03:51 GMT

Yes, the DOT hours still apply, but if you are W2 the Job Related Expenses are no longer deductible on the federal tax return.

See Can employees deduct any job-related expenses?

@pilotchip

Re: Well then the current 2106EZ guidance and IRS Pub 529 Mea...

Muneco803 — Sun, 04 Dec 2022 22:45:07 GMT

I agree. Im a controller and i put in for that per diem here on turbo tax. Trump changed a few things so now I get half. We technically cant leave the facility for breaks or meals.

Re: Looking at the instructions from the 2106-EZ It directly...

Muneco803 — Sun, 04 Dec 2022 22:48:21 GMT

i put union dues and uniforms, reading material, shoes, etc and I get back a bit.

Re: Looking at the instructions from the 2106-EZ It directly...

xmasbaby0 — Sun, 04 Dec 2022 23:10:55 GMT

@Muneco803 Are you a W-2 employee?

Sorry---W-2 employees cannot deduct job-related expenses on a federal return. Job-related expenses were eliminated as a federal deduction for W-2 employees by the tax laws that changed for 2018 and beyond. Your state tax laws might be different in AL, AR, CA, HI, MN, NY or PA.

https://ttlc.intuit.com/questions/4482873-which-federal-tax-deductions-have-been-suspended-by-tax-reform