I do work part time for We Go Look and received a 1099-misc for that work. I have not set up a business I own to do the contracting work under. I use my personal car for the work. In the business section of turbotax to claim business vehicle deductions it asks for my business profile information but I don't have a business. Can I still deduct the mileage?
Yes, you can deduct the mileage. As an independent contractor (received a 1099-MISC) you are considered self employed by the IRS. Because you received a 1099-MISC, you are considered a "business" owner.
In TurboTax, when asked to fill out your business profile, you would enter your name as the "business" name and your physical address as the "business" address. Then you would answer the additional questions in the business profile that apply. You are not required to have an EIN since you don't have employees and in most cases your accounting method would be the "cash" method.
After entering the business profile info, then you will have the opportunity to enter in your business income (income from your 1099-MISC) and your business expenses (including vehicle expenses-mileage)
You have the choice of two methods, to claim vehicle expenses. The first option is mileage. You can deduct the miles driven for business. The other option is claiming all your actual expenses such as gas, tires, interest, etc.
I'd like to add to the original question. I am an independent contractor, but I work out of one place. I drive from home, to my place of work, and back again. Is mileage still deductible in this case?
Yes, you can deduct mileage because you are an independent contractor and your primary place of business is your home. Since your home is your primary place of business, going to and from the worksite would not be considered commuting miles.
I am in a similar situation and am looking for clarification regarding deducting mileage. From your post I understand that I can write off the miles driven TO the worksite, but NOT from the worksite back home. Is that correct?
No, since you are an independent contractor you can deduct the mileage going to and from your home.
In TurboTax, when asked to fill out your business profile, you would enter your name as the business name and your physical address as the business address. You would answer the additional questions in the business profile that apply. You are not required to have an EIN since you don't have employees and in most cases your accounting method would be the "cash" method.
After entering the business profile info, then you will have the opportunity to enter in your business income (income from your 1099-MISC) and your business expenses (including vehicle expenses-mileage).
You have the choice of two methods, to claim vehicle expenses. The first option is mileage. You can deduct the miles driven for business. The other option is claiming all your actual expenses such as gas, tires, interest, office supplies.
Please find IRS Publication 334 for more information on what you can claim as an expense.
On Page 32, Publication 334 states: "...Your workplace can be your home if you have an office in your home that qualifies as your principal place of business. For more information, see Business Use of Your Home, later" This has always confused me (and I'm sure many others).
Here is the situation. I am a sole proprietor in two separate businesses. I use my personal vehicle and take the standard mileage deduction for both businesses. For the first business, I do computer support, which includes driving to client's sites and then, usually, home. For my second business I do Uber/Lyft driving. For this business I normally go on-line with the Uber driver app from home and go off-line at the end of the day at my home.
My question is: Do I need to have an actual "home office" (area only used for business, etc.) in order to claim my home as my place of business and, therefore, claim my vehicle expenses from and back to my home?
No you do not need an actual "home office". Transportation expenses include the ordinary and necessary costs of all of the following.
Getting from one workplace to another in the course of your business or profession when you are traveling within the city or general area that is your tax home.
Visiting clients or customers.
Going to a business meeting away from your regular workplace.
Getting from your home to a temporary workplace when you have one or more regular places of work. These temporary workplaces can be either within the area of your tax home or outside that area.
What if I have a home office, and while traveling to meet a client, I drop my child off at a babysitter's... when do I start/stop tracking miles? Leaving my home and returning back home, or leaving the sitter's to the meeting and back to the sitter's?
You just need miles between your home office and the destination. One way to do this is to look up the distance from home office to the client location and use that mileage. That way you just don't count the detour (personal miles). A log page can look like:
Date Departure Destination Business Miles Business reason
If you leave one client and go to another, do the same, look up the distance. This way it really doesn't matter what you do in between. When figuring business miles at year end, you just need the beginning and ending mileage from the odometer and the total business miles column from the log.
Ok. When I hear “primary place of business” I think of where I’m actually making my income, which is at my place of work (which isn’t my home). I don’t travel from site to site.
So, when deducting this mileage, do I deduct round trip or one way?
You are correct; you are a business owner and your place of business is not your home. The miles to/from your home and place of business are commuting miles and not deductible. Here is link with some helpful information on the subject.
That’s what I thought. Thank you for the confirmation. It’s so confusing when one tax expert says yes and another says no. I just want to make sure I’m doing this right and not setting up any red flags.
Thanks again
I'm really confused about commuting versus business miles. It's my understanding that commuting mileage is not deductible and business mileage is. If I'm wrong in this understanding please correct me on the terminology because if you say commuting I will assume it is not deductible and if you say business I will assume it is deductible.
My husband is an independent contractor and received a 1099-MISC. It is from a lawn care service so the business conducted includes multiple job sites per day. Does he include mileage from home to the first job site of the day and mileage from the last job site of the day to home as business mileage or commuting mileage? I know the mileage from one job site to another is business mileage and is deductible but I'm confused about whether the trip from home to the first and from the last to home is deductible or not since he doesn't actually own this business.
He also has his own construction business that he does own himself. It is a registered business in our state. The business structure is an LLC, not that that particularly pertains to this question but just in case. The business office is our home and we do claim the simplified deduction for home office. The jobs are usually full day jobs so he will only travel to and from one temporary job site in a day. In this case, would his mileage from home to the job site and back home be business or commuting mileage?
Here are the answers to your questions:
For the lawn care business:
You would only deduct the miles to the house to the first job and from the last job home only if the office of the business is located in the home. If the business is run out of the home, and there is a home office you would deduct those as business miles.
For the construction business:
You have two options for deducting the home office:
1. You can take the actual expenses (home mortgage, interest, electricity, gas, etc) and claim the percentage that applies to the office (if you office is 10% if the home, you get to deduct 10% of the expenses).
2. You can take the simplified method which is a set formula the IRS determines based on the square footage of your office.
To read more about home office deductions click here: https://ttlc.intuit.com/community/credits-and-deductions/help/can-i-take-the-home-office-deduction/00/26056
That makes sense with the lawn care business. It is owned and operated by our son and his home is the home office so our home is not the primary (and only) office for this business. So he can only claim mileage from one job to another, he can't claim mileage from our home to the first and from the last back to our home as business mileage it is commuting mileage. I do have to recalculate the mileage because I did have the mileage to and from our home included. Thanks for clarifying!
The construction I'm still a little confused about. I have the home office deduction figured out. Our home is the location of the primary (and only) office for this business. There is a designated area that is used for only business purposes. We don't owe anything on our home so there is no mortgage or interest and the area is only 80 sq feet so the simplified deduction is best for us. The only thing I was a little uncertain about for the home office is do I claim the internet and land line portion used for business purposes or is that included in the simplified deduction? I did claim the business portion of his cell phone because I'm confident that isn't included in the simplified deduction but I wasn't completely sure about the internet and landline phone so I did not include that in other expenses.
But the mileage isn't included in the home office deduction. So if the same rule applied then his commute to a job site, or to bid a job or conduct any type of business related matters, would be from the business office (our home) and would be deductible as business mileage not commuting, correct?
Clarification is needed here.
Commuting miles from your residence to your *PRIMARY* place of business are *NEVER* deductible. No exceptions.
If you are self-employed, claim a home office ***AND*** that home office is your ***PRIMARY*** place of business, then you do *NOT* have any commuting miles from your primary residence, to your primary place of business.
I do understand what can be claimed on the 1099-MISC he received from the mowing business that has an office outside our home.
However, he also owns a construction business that is a completely different company than the mowing business. It is a single member LLC that he is the sole owner of. I’m still not 100% sure where The start and end points are for mileage on this business.
I think I will just take our taxes to a CPA this year to make sure I am understanding this correctly. Once I get the terminology clarified I will feel more comfortable self preparing. Thanks for all the responses.
One more scenario to throw in - haven' t been able to find anything this specific on the plethora of articles around the web.
Details:
Self-employed with home office as the only place I do any management / accounting etc.
This summer I worked 2 days a week for an agricultural operation as a contracted worker. While it was somewhat unrelated to the normal type of operations of my LLC, all financial activity ran through the business and I received a 1099 for this work.
The ag operation is approximately 15 miles from my home.
Is this commuting or deductible mileage?
Thanks!
Given the facts as you have presented them, it is deductible mileage.
Here is what the IRS says:
"If you have one or more regular work locations away from your home and you commute to a temporary work location in the same trade or business, you can deduct the expenses of the daily round-trip transportation between your home and the temporary location, regardless of distance.
If your employment at a work location is realistically expected to last (and does in fact last) for 1 year or less, the employment is temporary unless there are facts and circumstances that would indicate otherwise."
Publication 463 (2019), Travel, Gift, and Car Expenses
Hi,
So, this is my situation. I receive a 1099 from a gym where I teach gymnastics. I know that I am an independent contractor, but I am confused about whether or not my mileage to and from the gym where I teach is commuting miles or deductible mileage. I don't technically have a "home office", but I do file a Schedule C. I have to travel to the gym where the gymnastics equipment is to teach my students. This is the only place where I go to teach. Is this commuting since it is the only place I go to?
Any help would be much appreciated.
Yes, this is considered as commuting mileage and it is not deductible. Commuting is travel between your home and a work location.
Business miles are incurred when you go from one workplace to another workplace and are a deductible expense.
I'm in a slightly different situation. I am an employee at my main job. This summer I took on consulting work as an independent contractor. On the weekends, I would travel to my contract job then home. During the week, I would travel from home to my main job, then to my contract job after work, then home. What miles can I deduct? The round trip on the weekends? The mileage between my main job and contract work? All the mileage?
Thank you in advance,
Ron
You can deduct the mileage driven above and beyond what you would normally have driven for your main job.
In your case, all the weekend mileage (the round-trip) and a portion of the weekday mileage would be deductible expenses for your contract income.
The weekday calculation is little trickier. If your normal home-main job-home commute is 15 miles, but driving to your contract job adds 10 miles (total of 25), then you'd be able to deduct the additional 10 miles as an expense against your contract income. Basically, you get to deduct whatever mileage the contract job requires above your normal daily commute.