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How to properly expense this?

Old 05-14-2018, 03:12 AM
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Default How to properly expense this?

I commute 150 miles round trip to work. I also own 20 rental units near my work. They are all located close together and I frequently cruise through the neighborhood just to see if anything is out of place. What would be the correct way to right off the travel?
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Old 05-14-2018, 03:27 AM
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You can take the actual expense or the current govt allowance. Unfortunately, your time is free.
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Old 05-14-2018, 03:45 AM
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Originally Posted by airbrush View Post
You can take the actual expense or the current govt allowance. Unfortunately, your time is free.
Understood. I'm wondering if I can take the whole trip as an expense on the rentals on those days that I "swing through" even though I am going to my other job. It seems like it would be 50% of the travel. I took a bath on taxes this year and looking for some ways to help next year. I have never bothered with using this situation as an expense before? Will have to visit with the CPA.
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Old 05-14-2018, 03:53 AM
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If it were me, I'd expense the whole trip. It's amazing how much money I lose on my rentals. Don't forget, if your incorporated you get to hold that annual shareholder meeting in, say, Bora Bora or fiji?
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Old 05-14-2018, 03:56 AM
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Write-off...

Since you are already commuting nearby, the write-off would be any incremental mileage times the rate of 54.5 cents.

Trip to/from work is 150 miles, to/from work plus drive-by is 153 miles, write-off is 3 x 54.5 cents or $1.64.
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Old 05-14-2018, 04:00 AM
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Originally Posted by rickboat View Post
Write-off...

Since you are already commuting nearby, the write-off would be any incremental mileage times the rate of 54.5 cents.

Trip to/from work is 150 miles, to/from work plus drive-by is 153 miles, write-off is 3 x 54.5 cents or $1.64.
I'm thinking my math is better.
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Old 05-14-2018, 04:06 AM
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The commute to and from work is considered personal mileage. If your work was related to the rental, the mileage from your home to the first rental would be personal, but the mileage from there to work would be business. Maybe buy a rental near work? And if it is isn't looked at, you can deduct whatever you want.
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Old 05-14-2018, 04:14 AM
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Only the additional miles over the 150 of your normal commute can be expensed.

Of course you can try to claim anything as a business expense to see how it flies with the IRS. My advice would be to only claim the overage.
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Old 05-14-2018, 05:40 AM
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Best way to do it is convert your employment to 1099. Then deduct all business related expenses including visiting a client.
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Old 05-14-2018, 05:50 AM
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Originally Posted by crazybeard View Post
Best way to do it is convert your employment to 1099. Then deduct all business related expenses including visiting a client.
then you get hit with both ends of SS contribution. If you max out at $128k it will cost you an extra $8k plus any loss in health insurance plus 401k etc. definitely not worth trading for a 30,000 mileage write off.

Im sure you have a few weekend trips out there.
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Old 05-14-2018, 05:58 AM
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Originally Posted by bjm9818 View Post
then you get hit with both ends of SS contribution. If you max out at $128k it will cost you an extra $8k plus any loss in health insurance plus 401k etc. definitely not worth trading for a 30,000 mileage write off.

Im sure you have a few weekend trips out there.
When contemplating the "rate" you will charge under 1099 terms, these realities are typically factored in. Your employer won't care because he already pays it. Getting you off his back as a liability is a godsend to him. (your experience may vary)
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Old 05-14-2018, 05:59 AM
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Originally Posted by bjm9818 View Post
then you get hit with both ends of SS contribution. If you max out at $128k it will cost you an extra $8k plus any loss in health insurance plus 401k etc. definitely not worth trading for a 30,000 mileage write off.

Im sure you have a few weekend trips out there.
who said you can’t incorporate or form an LLC there is 20% right away. Possibly deduct vehicle costs not just mileage. Part of the negotiations would be to include the $ for healthcare coverage if that’s included now.
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Old 05-14-2018, 06:13 AM
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Originally Posted by chrispnet View Post
When contemplating the "rate" you will charge under 1099 terms, these realities are typically factored in. Your employer won't care because he already pays it. Getting you off his back as a liability is a godsend to him. (your experience may vary)
I was just pointing out one problem with completely rocking the boat and going independent just to get a mileage expense write off. It all would depend on what the OP does for a living. The IRS is cracking down on classifying who is a subcontractor and who is an employee. As an employer I wish all my employees were 1099. For the OP if his business slows and get let go no unemployment benefits also.

A 150 mile daily commute is pretty extreme and opens up some tax saving possibilities if you are creative.
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