TaxProf Blog: Lessons From The Tax Court: A New Twist On Travel Away From Home Deductions? (February 28, 2022)

Bryan Camp has published an article on the TaxProf Blog: “Lessons From The Tax Court: A New Twist On Travel Away From Home Deductions?”, which discusses transportation costs and their deductibility in tax court. The article begins as follows:

When I teach the §162 travel away from home deductions I tell my students to distinguish between transportation costs (on the one hand) and meals/lodging costs (on the other hand).  Transportation costs are covered by Rev. Rul. 99-7.  Their deductibility turns on job site location.  To deduct meals and lodging expenses, however, the taxpayer must meet an overnight rule as well.  United States v. Correll, 389 U.S. 299 (1967).  I have never taught that the overnight rule applies to transportation costs.
After reading today’s case, I may have to change how I teach this issue.  In James P. Harwood and Connie J. Harwood v. Commissioner, T.C. Memo. 2022-8 (Feb. 15, 2022) (Judge Urda), Mr. Harwood worked at various temporary job sites located in cities away from his tax home in Yakima, Washington.  Sometimes he stayed overnight at the job sites, coming home on weekends.  Sometimes he drove there and back in the same day.  If I’m reading the opinion correctly, Judge Urda applied an overnight rule to hold that when Mr. Harwood chose to drive to and from his job site in the same day, he could not deduct the transportation costs.  That’s a new twist on the law from what I can tell.  So we should pay attention.  Details below the fold.

Click here to see the full article: “Lessons From The Tax Court: A New Twist On Travel Away From Home Deductions?”

Edited by Mallory Wentz, Associate Editor, Wealth Strategies Journal.

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