Need help to calculate % of car miles used for business...

[Slav4ikMD]

Hi guys, this is kinda basic, but I want to make sure that I am calculating my percentage of car mileage used correctly.  It's a somewhat complex situation as I have several locations of employment (and self-employment) and find the rules to be somewhat confusing.  So here is my quick outline:

In the morning I drive from my home office (I have a legit office attached to the home where I see some patients) to a bank where I deposit checks (is it reasonable to do this daily or would IRS prefer one did it weekly?) - I assume this mileage is business.  Then I drive from the bank to my W2 place of employment - that does not count.  After that I drive to another self-employed location - I assume that mileage also does not count.  And then I drive from the second self-employed location to my home business office - I assume this mileage does count.

To make matters more complex, sometimes I also drive from one W2 location to another W2 location - does that mileage count?  I think it does...  When I return from the second W2 location to the home office, does that count?

I am also uncertain re concept of "principal place of business" - if the bulk of my self-employed work happens in my home office, BUT it is still a minority of my total work hours for the week as I am also employed, is my home office still a principal place of business for IRS purposes?

Any other words of wisdom on this?

Thanks!

[jfoxcpacfp]

This is a topic you really, really need to discuss with your CPA at the personal level. It depends on your specific set of facts and circumstances.

In general, I find that as long as the IRS believes you are trying to be fair and reasonable with your mileage record-keeping and doing so on a contemporaneous basis. Assuming your W2 job is your main source of income, I would probably count all mileage beyond the round trip to and from your W2 job as business. You know what that amount is. Just deduct it from your daily mileage.

For IRS purposes, your home office is your principle place of business for your SE work. That's what matters, not the fact that you have another source of income (W2).

It's none of the IRS's business how many times a week you go to the bank. I personally would want to go only once a week (and my bank is less than a mile away), but your preference may be daily. So be it.

[Slav4ikMD]

Thanks Johanna, that's helpful as always.  I will definitely discuss this with my CPA as well, just doing my "homework" to gauge what's common and acceptable.  What my CPA says is of course just one opinion - I like to collect several and make my own informed decisions.

The bank stop is obviously a strategy, not a true necessity.  If I drive from my home office to the bank which is 20 miles away and then go to my W2 job that is a mile from there, it becomes a way to count those miles - or is that really stretching it and not kosher?

So miles between two W2 sites do count, correct?

[jfoxcpacfp]

You can deduct miles from the 1st W2 job to the 2nd W2 job, but those are employee business miles, subject to the 2% limit (sorry, overlooked that there were 2 W2 jobs in 1st reply).

If you truly feel the need to take a poll to get other opinions to give to your CPA, you either don't have the confidence you should have in a talented professional (and may well be annoying him) or you intuitively realize you are working with the typical half-interested CPA who needs your "informed decisions" to reach a conclusion and who doesn't deserve your business.

[Slav4ikMD]

I can't possibly have confidence in someone who I have not yet even worked with for one full year.  I do like my current CPA better than my last accountant and think he is much more knowledgeable but am recognizing that he is rather "conservative" so I do want to make sure I am on top of things as well.  And to be fair, I think it is ALWAYS good to trust but verify and to continue learning on your own from more than one source!

It really is a fine line - yeah if my patients will google everything and see multiple docs for opinions, that is ridiculous and annoying; but if they obtain info from legit sources and come to me with informed questions, it frankly makes my job easier AND makes me recognize that I may have missed some things for their unique situation.

So I shall continue to ask even the most basic questions here.

[jfoxcpacfp]

Dearest Slav4ikMD, please don't take offense  :cry: . I think it is fine to ask basic questions here and I enjoy answering them. If you have used your current CPA for less than a year, it makes sense to double-check. In all fairness, my impression was that second-guessing your CPA is something you do as a matter of course. And, yes, I have learned myself from clients who have read something pertinent that I haven't run across - no problem with that. otoh, clients who come to me year after year telling me what they heard from their brother-in-law or down at the post office don't tend to stick around very long. Your analogy was an apt one.

[Slav4ikMD]

No offense taken.   Second guessing - no; questioning, analyzing, learning and comparing - yes.  I would be a fool to take any anything any one person tells me for granted, regardless of their credentials.  In my experience - and this equally applies to medicine, and I believe most other fields - there is almost always more than one way to approach things and sometimes talking to several people helps you think of creative approaches or solutions.  I do hope that some day in the near future I will have learned enough to know most basics when it comes to accounting and taxes AND will find a CPA who I fully trust (and hopefully will remain to be my current person).  I am still relatively early in the game, so learning from all sources I can get my hands on.

But I realize I am probably sounding a bit defensive about my approach.  We all function a little differently in this regard, and that too is ok.

But this is all for a different more philosophical platform.

[Craigy]

Generally speaking, any commuting mileage, which, again generally speaking, included going to and from your place of work.  If you have multiple places of work you could theoretically have multiple commutes which are typically non-deductible.

This is something your CPA should be well versed in, should be able to give you good advice in your specific circumstances.  Consult with your CPA or another qualified tax professional.

[jfoxcpacfp]

Craigy wrote:

Generally speaking, any commuting mileage, which, again generally speaking, included going to and from your place of work.  If you have multiple places of work you could theoretically have multiple commutes which are typically non-deductible.

This is something your CPA should be well versed in, should be able to give you good advice in your specific circumstances.  Consult with your CPA or another qualified tax professional.

Click to expand...

Yeah, but the issue, as I understand it, is that he has an office, which is his main place of business. His commute is from home to the office. (edited to add: I got this mixed up with another OP who actually has an office away from his house and a separate business. I stand by my original advice. I'm sorry!) Driving to various locations from his office should be deductible, at least in the fact pattern presented.

[Sajimone]

I would download the MileIQ app to your cell phone!  It's easy to use and it automatically logs your travels from any point A to point B.   Then at the end of the day or week or month... for each leg of every trip you've made, you can simply swipe (Tinder-like) left if personal, medical, charity, moving or right if business related mileage.  Free for the first 40 driving logs a month.. but charge a small fee for unlimited logs a month.   Probably worth its fee and more for the convenience of providing an annual audit-defensible log of all your travels with map documentation.

Agree with always learning and asking for more opinions!