On-the-road Meal Deductions

June --

I've been a newspaper courier for 5 years.

I deliver several different weekly newspapers all in different cities. I use my home as an office. I travel over 500 miles a week and my routes are quite large. I'm on the road for 10 - 12 hours a day 3 days a week. I get very tired from driving that long + lifting bundles. I sometime stop to eat and rest. Would my meals be deductible?

Thank You, Kevin from Kent, Ohio


Hello Kevin,

You don't say whether you stay overnight nor how long you rest. Based on what you've said, your meals are not deductible.

Meals while on the road are deductible if your trip is considered "travel." Travel means you must stay overnight or you must rest to properly perform your duties.

If your trip is considered travel you may deduct all travel expenses and the cost of meals and lodging.

In my book, Self-employed Tax Solutions, all travel and also travel-meal expense is explained in depth. It is an expense topic that has a lot of rules as well as nuances. Here's a Travis Truck Driver example directly from my book:

Travis Truck Driver leaves the terminal at five in the morning. Three hundred miles later he’s at the turnaround. While his truck is being unloaded he has a big lunch and then dozes off outside the diner while waiting for the guys to finish the reloading. He then heads back to the terminal where the truck is again unloaded. He’s home by midnight. Travis’ lunch break nap was just that, “a nap.” It was not enough time to get adequate sleep. His trip is not considered travel. Therefore he cannot deduct travel expenses.

Best,
June

Driving to see clients

June --

My wife started working as a contract employee doing work for Area Agency on Aging. She works directly with clients to set up services for them requiring her to drive out of town weekly. Can we deduct the business portion of the purchase of an automobile for her to drive to see her clients.

Gary in Nebraska


Dear Gary,

Apologies for this late response. Your email was lost in the virtual forest. For an answer, read tip # 2 in Designers Dozen: Tax Saving Tips for the Graphic Artist and also Auto Expense: From one work location to another .

They tell you what is business transportation and which isn't.

Then read Two Ways to Calculate Auto Expense on my website which will explain whether you can deduct the cost of your car.

Best regards,
June Walker

To learn more about indie taxes and Self-employed Tax Solutions please visit http://www.junewalkeronline.com

Driving from home to work: Is it deductible?

Hello June,

I am a limousine driver. Can I deduct the cost of gas for getting to work and back? I was driving a company car and they paid for the gas. I was driving my car to the base to pick up the limousine.

Thanks.
Lilka in New York


Sorry, Lilka, you cannot. From home to work is considered a commute, and commuting costs are not deductible. Take a look at Auto Expense: From one work location to another .

Best,
June

New to Self-employment

June --

I am a contract driver. This is our first time filing as a 1099 what do you suggest?

Thanks,
Joey


Joey--

If you've never before been self-employed you need information -- a lot of it, more than I can provide in an email or a blog post.

I suggest you start by going to "Categories" on the left and choose the "being self-employed" category. There are a number of posts that will be useful to you.

If you like what you read there and you are looking for basic information on taxes and recordkeeping income and expenses check out my book Self-employed Tax Solutions. Here's a link to the book's Table of Contents.

June --

Employee vs. Self-employed

Dear June,

My husband is a subcontractor delivering office supplies. He has hired a helper on a full time basis. My husband is listed as a sole proprietor. Should his helper be classified as an employee or contractor, and what are the advantages and disadvantages of either?

Hope from Georgia


Dear Hope,

If the helper is full-time and not offering his services to anyone else and he works at the direction of your husband, it's likely he is an employee. If he meets certain criteria he must be one or the other, you really don't have a choice. And, if he is an employee you will have to withhold taxes and prepare payroll forms.

Because of the many tax advantages to self-employment many folks try to twist the regulations to fit their situation. To cover both the contrived and the honest situations, the IRS has put together a guide to help determine whether someone is an independent contractor or an employee. The IRS focuses the criteria upon a single issue – control versus independence. The IRS looks at things like: Does the worker perform independently? To what degree is his work controlled?
It is a question of relationship, it is a matter of degree, and it is measured in three categories. The categories are:

• Behavioral control· Who directs and controls what will be done and how it will be done?
• Financial control · Who directs or controls the business aspects of the work?
• Type of relationship· What facts show the type of relationship?
  
  There are a couple of columns on my site about self-employed vs. employee and the advantages and disadvantages of each. You might want to read It's all about relationships: Are you an employee or are you self-employed? and Employee or Self-Employed:Which is Better?

Also look in the Archives on my site for more information about employees and self-employment.

And, as always, read the book that can simplify your tax and financial life, AND save you money!
SELF-EMPLOYED TAX SOLUTIONS .


Best,June