In article <m3wsohf9c8.fsf[at]swing-shift.time-tripper.com> ,
Rich Carreiro <rlc-news[at]rlcarr.com> wrote:

- quote -


OK, thanks much, learn new things every day (even if not all of them are
things one wanted to learn).

It's likely that the majority of my consulting clients also have
"accountable reimbursement plans", since they're fairly large firms.

If so, would your statement above saying that "reimbursed employee
expenses that meet the rules are by law not reported to anyone" maybe
apply to "reimbursed CONSULTANT expenses that meet the rules" as well?

[Let me say, mine are all brief, generally one-shot consulting
engagements; I'm definitely not a employee of any of these clients.]

In any case, I'll check this out w/my tax preparer.

Thanks again.

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AES <siegman[at]stanford.edu> writes:

- quote -

That's because your employer had an "accountable reimbursement plan".
With a plan like that in place, reimbursed employee expenses that
meet the rules are, by law, not reported to anyone.

If they did not have an accountable plan, they would have had to
include the reimbursement in your W-2, and you'd have to show
your expenses as employee expenses on Sched A (which would likely
mean you wouldn't actually get to deduct most of them).

So the fact that your employer (and you) didn't report reimbursements
does not mean such treatment analogized to your sole propietorship,
because the lack of reporting is due to them having an
accountable plan.

--
Rich Carreiro rlc-news[at]rlcarr.com

--
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In article <fql0s4$b07$1[at]doliolum.localnet> , una[at]att.net (Una) wrote:

- quote -

I'll consider any opinions, advice and counsel I can get on this.

When I was full-time (salaried) faculty member and occasionally traveled
to scientific conferences, I initially paid for all travel expenses out
of my own funds, then on return submitted itemized travel expense report
to university, got reimbursed by them for my actual expenses (with the
money usually coming from some sponsored research contract). None of
these travel expense transactions ever showed up on any payroll slips,
1099-whatevers or any other compensation-related documents from
university to me or (I assume) to the IRS, or were entered in any way
into my tax returns.

In occasional consulting since retirement, things usually work the same
way, except I submit to client an invoice showing both a "Consulting
Services" amount and a separately itemized "Reimbursable Expenses"
amount. Client most often pays total amount in one check (sometimes
with two separate lines showing on the detachable portion of the check),
but their year-end 1099-MISC most often shows only the total "Consulting
Services" amount for the year, without any mention of the "Reimbursed
Expenses" amount; and that's all that goes on my tax return.

Any major problems with this approach? (My returns are professionally
prepared; and the "Reimbursable/Reimbursed Expense" items are all
carefully entered and balanced, income and outgo, in my personal
records, so I'd have no trouble justifying them in detail if required.)

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Paultry <afn02552at[at]afn.org> wrote:
- quote -

Yes, and I think we all understand that. The OP wants to reduce the
gross to equal the net, presumably to create a layer of protection
between the OP and the IRS. I doubt that would work; if an audit
shows OP was paid more than reported on the 1099-MISC, documentation
of expenses will be necessary, right? So demanding a 1099-MISC
that shows net income rather than gross income gains the OP nada.

Una

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On Mar 3, 2:35*pm, Rich Carreiro <rlc-n...[at]rlcarr.com> wrote:
- quote -

A great article to read that helps you to understand the background of
the "principle place of business" and "home office" delima is found
at

http://www.taxlawcenter.com/Art1099A.htm This article titled
"Deductions for Home Office and Auto Expenses" by Gary D. Borek also
sites several tax court cases

Then after that reading apply Revenue Ruling 99-7 found at
http://www.taxlinks.com/rulings/1999/revrul99-7.htm

Here is my take.....Your client would probably qualify for a home
office under the "administrative or management activities" standard
brought about in the Taxpayer Relief Act of 1997 when congress amended
&280A (softening the "Soliman decision") However your client is not
using the area regularly and exclusivly and therefore is denied the
deduction. Hense your delima.....will the position that the taxpayer
does not have a qualified home office preclude her from claiming
transportation expenes from the home to her places of work.

Read Strohmaier v. Commissioner 113 T.C. No. 5 (August 3,
1999)...court held against the taxpayer...stating that the
petitioner's most important function was not performed in the
home....and therefore transportation was denied
Same thing in Cole v. Commissioner, T.C. Memo 1999-207 (June 23,
1999) However: the opposite was found in Gosling v. Commission,
T.C. Memo. 1999-148 (May 3, 1999).

This is why the area is still so confusing....Most these cases are
trying to get the home office deduction.....using the "primary place
of business" OR the "administrative or management activities
standards. Your client, (and mine) are NOT trying to deduct home
office expenses, but rather transportation costs from their home to
places of work. I believe the taxpayer has to prove his home is the
"primary place of business" to be able to deduct the mileage. In
other words the "administrative or management activites standards" do
not pertain the the transportation costs issue like they do the home
office issue. In each case I have read, my client and yours (in my
opinion) would fail the "primary place of business" test in order to
deduct the mileage from their homes to places of work....Seems counter
intuitive I know, but that is how I read the cases.

Recent cases site the need for "primary place of business" as a
requrirement for travel expense deductions....and refer back to the
above mentioned cases see http://www.ustaxcourt.gov/InOpHistor...ta.sum.WPD.pdf
..

One way to help your client is to have them establish a home
office....make a small corner to be used regularly and exclusivley for
administrative and management activities.....There is no "minimum
space" requirement....A corner desk might take up a 5 x 5
space....Code Section 280A as amended specifcally states that a home
office qualifies as a principle place of business if there is no other
fixed location for the trade or business, and the area is used to
conduct management and administrative activities.....Hense the mileage
from home to work would be deductible.

I am wide open to other opinions that have researched this issue and
have case sitings. I am still very interested in getting the
deduction for my client if I can reasonably use a case for authority.

--
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AES wrote:
- quote -

Though it doesn't read that way, I believe what is being
suggested here, as you probably inferred, is that you
subtract all your expenses on Schedule C *before* you count
the payment as NET income. The full 1099 amount needs to be
reported as gross income else you'll surely be questioned in
a year or two when IRS matches the 1099 with the return.

--
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In article <fqk6tk$a1m$1[at]doliolum.localnet> , una[at]att.net (Una) wrote:

- quote -

I agree -- but in this latter case, do I not actually have to report the
full payment as income, then deduct the reimbursed expenses as
deductible business expenses on the appropriate lines? -- which opens up
all the potential complexities and hassles of what are and are not
allowable deductions.

Certainly simpler (and less bookkeeping for me) to have the
(legitimately) reimbursed expenses never show up as income.

--
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AES <siegman[at]stanford.edu> wrote:
- quote -

That is not necessary. You can just let them report the full payment
on the 1099-MISC, then to prepare your tax return you subtract all your
expenses (including mileage) *before* you count the payment as income.

Una

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"removeps-groups[at]yahoo.com" <removeps-groups[at]yahoo.com> wrote:

- quote -

No question about that. The issue was whether, if that non-qualifying
home office is the person's primary place of work, travel expenses can
be taken when the attorney visits clients. I believe the answer is
yes.

Stu

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In article <Xns9A56A4FE11EF9avocatstuyahoofr[at]130.133.1.4> ,
Stuart Bronstein <spamtrap[at]lexregia.com> wrote:

- quote -

I am only a sole-proprietor consultant, not a tax expert -- but if I
travel longer distances from my home workplace to a client's location at
the client's request, I certainly include the air fare, local taxis,
etc, as reimbursable (and ergo non-taxable) expense items in the invoice
I eventually send. (Sometimes have to hassle a bit with their
bookkeepers to have this part of their payment NOT be included in the
year-end 1099-MISC they send me.)

I haven't and probably wouldn't bother with doing this just for mileage
expenses when the journey is only a few tens of miles auto trip -- but
seems as if I, and the OP, could do so . . . ???

--
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2007 Pub. 17, page 176, Figure 26-B and accompanying text,
particularly that on "temporary work location," should
resolve this.

She has some other tests to pass (e.g. one year test;
metropolitan area test) before the travel expense is
deductible.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

On Mar 3, 12:35 pm, Rich Carreiro <rlc-n...[at]rlcarr.com> wrote:

- quote -

Publication 587 suggests that even part of a room may qualify

<Quote
Exclusive Use

To qualify under the exclusive use test, you must use a specific area
of your home only for your trade or business. The area used for
business can be a room or other separately identifiable space. The
space does not need to be marked off by a permanent partition.

You do not meet the requirements of the exclusive use test if you use
the area in question both for business and for personal purposes.

Example.

You are an attorney and use a den in your home to write legal briefs
and prepare clients' tax returns. Your family also uses the den for
recreation. The den is not used exclusively in your profession, so you
cannot claim a deduction for the business use of the den.


</Quote
http://www.irs.gov/publications/p587/ar02.html#d0e306

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Stuart Bronstein" <spamtrap[at]lexregia.com> wrote

- quote -



I would let that deduction go on the return if - these places of work do not
rise to the level of a regular place of work.

"She sometimes goes on-site", is grossly different from "she goes in every
Tuesday morning", or some other regular work schedule to the same
location(s).

I remember a judge in a court case - many gray hairs ago - saying "My son
works at Burger King, McDonalds and Wendy's, he's not self-employed in the
fast food business." (or something like that) when chastising someone for
taking a deduction for commuting.

I see a deduction there, home office issues aside.

Same for driving to the bank, the post office, the office supply store, or
the accountants office.




--
Paul A. Thomas, CPA
Athens, Georgia

--
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I work from home but do not claim deductions for a home office. When
I travel on work I count mileage from my home; it is my normal place
of work.

Una

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Rich Carreiro <rlc-news[at]rlcarr.com> wrote:

- quote -

That's where I tend to disagree. Some here seem to think that if your
home doesn't qualify for the home office deduction, you really have no
home office at all.

I don't think that's correct. You can still have a home office, even
if it doesn't qualify for the deduction. Among other things the code
specifically provides that you get the home office deduction for space
used to store inventory even if it doesn't otherwise qualify for the
deduction.

To me that means if you primarily work from home, communicate from
clients there and keep your business files there, even if the space you
use is not used solely and exclusively, you can still deduct mileage
expenses when going to the site of a client or for other business
purposes.

Stu

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

This overlaps somewhat with an earlier thread, but I wanted to ask the
specific question I'm interested in.

Taxpayer is a technical consultant operating as a sole proprietor.
Taxpayer does the vast majority of her work at home (teleconferences,
writing, programming, research, etc.), but does not see clients at
home. She sometimes goes on-site to the clients' place of business.
These trips are (so far) short (tens of miles each way) and are not
overnight. Taxpayer does NOT have a home office and does not take any
home office deductions, because there's no place in the home that does
(or can!) satisfy the exclusive use test.

So, when the taxpayer travels from home, to a client's place of
business, and back home, can that travel be deducted, because it is
travel away from and back to the tax home, or is it considered
non-deductible commuting?

--
Rich Carreiro rlc-news[at]rlcarr.com

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<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >