Tuesday, February 10, 2015

Deductible Mileage

Deductible Mileage

I think I’ve heard more anxiety expressed about deducting mileage than any other topic, specifically what is commuting and what is not.  Here’s the scoop.

The basic rule is that mileage for job-seeking and career-building activities is always deductible.  These would include actual auditions and interviews, but also meetings with your agent, trips for coaching and lessons, union meetings, and errands to photographers, studios and printers to get your head shots, demos, and résumés.  All these activities are ordinary and necessary in the course of pursuing an acting career, and this is probably most of your mileage. 

Driving to a regular job, including a theatre job, is commuting and is not deductible. We encounter a grey area when it comes to driving to temporary (“freelance”) W-2 jobs.  The Instructions for Form 2106 say that if you have at least one regular work location away from your home and you travel to a temporary work location in the same business, that’s not commuting – and is therefore deductible.  So let’s say you’re doing a show in a theatre (a regular workplace), and then you get a radio spot.  It would seem that your radio spot is a temporary job in the same business.  But what if you’re not doing a “regular” job when you do the radio spot?  Some would argue that since the work is temporary in nature, it should be deductible.

Other people are much more restrictive.  They say that if you’re driving to work, no matter how temporary it is, it’s commuting and non-deductible.  But what if you have a studio in your house?  Then your home is your principal place of business (at least for voice work), and your commute would therefore be zero, and any driving you did away from home would be deductible…..for voice work.  I have a very simple set-up in my house just to record voice auditions, but if I book a job, I go and do it in a studio.  So do I have a workplace in my house or not?

See how iffy it can get? 

Two instances of driving to a job that would be deductible are when you travel to a job outside your regular metropolitan area and when you drive from job to job.   I would also include driving between a job and a job-seeking activity.  That last point is probably the source of what you may have heard about deducting everything except your first and last trip of the day. 

The foregoing discussion applies to W-2 work. The rules for self-employment business mileage as outlined in the instructions for Schedule C are much looser, and I think you can make the case that all your driving is deductible. Again, most of your driving is for job-seeking and career-building, not for shoots and sessions. I can’t give legal advice here.  I would advise you to keep your records as regularly and as accurately as you can, so that whatever choices you make in claiming mileage deductions will be logical and consistent.

Mileage and other deductions discussed at length in The Actor’s Tax Guide:  www.ActorsTaxGuide.com

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