Mileage Deduction for 1099 Contactor

[DANRVAN]

Here are some references to my earlier post. This would apply in the situation where taxpayer works by day as branch manager at Hooterville First National Bank and then drives over to Bugsville to referee.

Please note that the facts and circumstances in Rev. Rul. 54-147 do not apply in this situation. But there are some general statements that do.

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Rev. Rul. 54-147, 1954-1 CB 51 -- IRC Sec. 23(a)

"Where a taxpayer is engaged in more than one trade or business and such businesses require a division of his time between two distant cities, he may deduct his traveling expenses incurred in discharging his duties at that city which is removed from his principal post of duty. Walter F. Brown v. Commissioner, 13 B. T. A. 832, acquiescence, C. B. VIII-1, 6 (1929); Joseph W. Powell v. Commissioner, 34 B. T. A. 655 (appealed on other issues); Joseph H. Sherman, Jr. et ux. v. Commissioner, 16 T. C. 332, acquiescence, C. B. 1951-2, 4. In other words, where a taxpayer has more than one place of business or employment his principal place of business or employment constitutes his “home” to serve as the point of origin for determining his deduction for traveling."

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Section 23(a)(1)(A), of the Internal Revenue Code provides that in computing net income there shall be allowed as deductions:

(a) Expenses.—

(1) Trade or business expenses.—

(A) In General.—All the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, including *** traveling expenses (including the entire amount expended for meals and lodging) while away from home in the pursuit of a trade or business; *** .

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RIA observation: Generally, when a taxpayer has two or more geographically separated places of business, he or she is away from home while at the location of the minor or secondary business.