Tax Court: Working From Home but Claiming Travel Deductions

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For federal income tax purposes, your tax home isn’t necessarily “where you lay your hat.” As evidenced by a new case, Barrett, TC Memo 2017-195, 10/2/17, the tax rules define your “tax home” as the general area of your main workplace. This could have a major impact on travel deductions claimed while you’re away from home on business.

In some instances, you may do work at various locations, without have a regularly established place of business. The determination of your tax home is then based on several factors, including the time spent in each place, the work performed at each place and the income generated at each place. If you’re self-employed, your tax home is often your actual home, but the IRS may dispute this.

In the new case, the taxpayer resided in Las Vegas, where he also owned several rental properties. His primary source of income came from his job as a video producer for the American Israel Public Affairs Committee (AIPAC).

The taxpayer began working with AIPAC in 1995. He occasionally performed services for other firms, but didn’t receive any income for such services during the tax years at issue. Video production includes writing scripts and reviewing footage, much of which he did out of an office in his Las Vegas home. Interviews relating to the videos were conducted in various locations around the world.

Before 2007, the taxpayer produced videos for AIPAC using studio facilities in Las Vegas, but then AIPAC built a new building in Washington D.C. From that point on, the taxpayer was required to travel to D.C. to use the editing facilities and other resources at the building. He continued to write scripts and perform pre-production services in his Las Vegas home.

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About Ken Berry

Ken Berry

Ken Berry, Esq., is a nationally known writer and editor specializing in tax, financial, and legal matters. During his long career, he has served as managing editor of a publisher of content-based marketing tools and vice president of an online continuing education company. As a freelance writer, Ken has authored thousands of articles for a wide variety of newsletters, magazines, and other periodicals.           

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