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I am a hybrid worker and every other month I needed to drive with my personal vehicle to a different state (about 300 miles each way). I would stay for a month in the new state and work there in the main office, then return to my home state and work at home for the next month. Would the 300-mile trip from one state to the other count as a business-related travel expense, or as a commute? Thanks!
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Are you a W-2 employee? Or are you self-employed---working as an independent contractor?
I'm a W-2 employee.
Sorry---W-2 employees cannot deduct job-related expenses . Job-related expenses were eliminated as a 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.
Thank you so much! Should I just skip that section on TurboTax or leave it blank then? Thank you for your patience by the way, this is my first time filing taxes.
Unless you are in any of the handful of states mentioned, just skip entering it.
Okay, thank you very much!
If your home state is your tax home then the trip to the other state would be deductible as a business-related travel expense.
"...Generally, your tax home is the entire city or general area where your main place of business or work is located, regardless of where you maintain your family home. In determining your main place of business, take into account the length of time you normally need to spend at each location for business purposes, the degree of business activity in each area, and the relative significance of the financial return from each area. However, the most important consideration is the length of time you spend at each location." Ref: IRS
This link Topic No. 511 Business Travel Expenses has information you may find useful.
What would be considered my tax home if I worked from home in my family home state for an equal amount of time as in my office's state? Would this be affected if my job's address listed on my W-2 was in a third state and I'm being taxed in that state but not my family home state?
If you spend an exactly equal amount of time in the two places - which seems unlikely given the number of days in a year, but it's your question - then your state residency is determined by where your homestead is, where you get your mail, where you're registered to vote and which state issued your drivers license/state ID.
If all these are equal then you can flip a coin. Or figure out the tax rate for residents vs non residents in the states in question and pick the situation that suits you best.
Whether your company's address on your W2 effects your tax situation depends on the state in question. Different states have different rules on taxing income earned from sources within that state by a non-resident - and some of those rules have been changed due to the pandemic.
You'll need to do some research on the state your W2 is from and then - when you're ready to file - do the returns in this order -
non-resident state
part year resident state
resident state
If you have had to pay taxes to the first two states it should be deductible on your resident state tax return. (Which is why it may be beneficial for your resident state to have the highest tax rate, weirdly.)
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