Q. I am a substitute dental hygienist who works in many different dental offices throughout the city ‚Äì anywhere from 5-40 miles from my house; some are within the metropolitan city nearest my home, although I do not live in the city. I am not a permanent employee in any of these offices and work maybe 10 days at the most in any office. I do not have a home office. Most of the offices pay with a W-2; a few pay using 1099Misc. What are the rules for a mileage deduction when it involves a temporary work location? Can I be reimbursed for bus fares?
- Joanna L.
A. Driving from home to a regular work location is considered to be commuting by the IRS and is not deductible. However, the commuting rule doesn't apply where you travel between your home and a temporary work location. A temporary work location is any place where you realistically expect to work less than one year. It can be inside or outside of the metropolitan area where you live.
However, if the location is inside your metropolitan area, this exception applies only where you have an outside office or other regular work location away from your home, which you don't appear to have.
So if you work for any of the dentists outside your metropolitan area for less than one year, your mileage could be deductible. However, since you're classified as an employee by most of the dentists, your mileage is deductible only as a miscellaneous itemized deduction on Schedule A. Thus, your mileage would be deductible only if you itemize, instead of taking the standard deduction.
Moreover, your mileage expense would be deductible only to the extent it, and any other miscellaneous deductions you have, exceed 2% of your adjusted gross income. These restrictions don't apply to your mileage for the dentists who classify you as an independent contractor. You can fully deduct this mileage on Schedule C.
Our resident small business tax expert, Stephen Fishman, answers your small business tax questions.