Cross References
• Saunders, T.C. Memo. 2012-200, July 17, 2012

Under the general rule, the cost of commuting between the taxpayer’s residence and place of business is a nondeductible personal expense. There are various exceptions to this general rule.
1) Expenses incurred in commuting between a taxpayer’s residence and a place of business may be deductible if the residence is the taxpayer’s principal place of business.
2) Expenses incurred in commuting between a taxpayer’s residence and a place of business may be deductible if the work location is a temporary location and the taxpayer also has one or more regular work locations away from the taxpayer’s residence.
3) Expenses incurred in commuting between a taxpayer’s residence and a place of business may be deductible if the work location is a temporary location and is outside of the metropolitan area where the taxpayer lives and normally works.

A taxpayer performed construction services as an employee of a construction business located in Cincinnati, Ohio. For the year in question, the taxpayer did not report to his employer’s office in Cincinnati, but rather traveled from his home in Manchester, Ohio to five temporary worksites. None of the jobs lasted more than a few months. The temporary worksites ranged in distance from 74 to 96 miles from the taxpayer’s residence. Each day the taxpayer drove directly from his residence to a worksite, and at the end of the workday, drove directly home. The IRS disallowed deductions claimed for commuting expenses to these temporary work locations.

The Court had to consider whether or not any of the exceptions to the general commuting rule applied in this case. The first exception did not apply because the taxpayer did not use his residence for business.

The second exception did not apply because there was no evidence presented to the court, and the taxpayer did not claim that he had any regular work location during the year in question. All of his work locations were temporary locations.

Author's Comment: Had the taxpayer driven to his employer’s work location in Cincinnati for business on a regular basis, the second exception could have applied.

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