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Huaren
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[转帖]5 Iffy Deductions to Skip at Tax Time

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2008-03-09 12:48:00

You should never be afraid to take a legit deduction," says Cincinnati tax consultant Edward Lyon, author of "Sixty Minute Tax Planner."

"Legit" is the key word in his statement. Some of the work-related deductions you might be planning may not be on the up and up.

Below are five of the most common pseudo deductions for which the IRS will ping you.

1. Commuter Miles

The most common deduction employees are tempted to take is commuter miles, according to Eva Rosenberg, taxmama.com proprietor and enrolled tax agent.

"Driving to work is a normal cost of being an employee," she says. "It's not really the IRS's place to subsidize our lives."

So while your office may reimburse you for miles traveled on the job, you can't deduct miles to and from work. Your boss may reimburse you for carpooling or taking public transportation to work, but the IRS won't.

There is one exception: If you work two jobs and drive straight from one to the other, keep fastidious records and consider deducting that.

2. Clothing

If you want to buy that $5,000 suit, feel free. But the IRS won't foot the bill.

"The average college student who grew up in jeans and a T-shirt and now has to buy suits may think, 'Isn't my suit deductible?'" she says. "A uniform -- a real uniform with the company's logo on it -- is, but nothing else is."

You can, however, deduct dry cleaning while on a business trip -- as a travel expense.

3. Home Office and Home Computer

We all take work home, but you can't deduct a portion of your rent or mortgage, or the cost of your computer -- unless your company explicitly requires you to telecommute and won't reimburse you for the computer.

"If your department has 30 employees but only 10 desks, and you have to work at home, you can take that deduction," she says. "But when you'd just rather work at home because you feel like it, that is different."

To qualify for the deduction, ask your employer for a letter explaining the office rules for telecommuting, and explaining that they apply to everyone in a similar position in the company, recommends Rosenberg.

4. Car Interest

Even if your job requires you to drive your own car 100 percent of the time, you can't deduct your car loan interest specifically. You can either take the IRS's allowance for mileage or what's called "actual expenses," which includes your car interest.

"The question is whether you're better off taking the allowance or the actual expenses," said Lyon. "That all depends on your actual cost to operate the vehicle. The mileage allowance usually costs you deductions if you drive anything larger than a standard-sized sedan."

Be sure to deduct whatever your boss pays you for mileage, though, before you take the actual expenses deduction, warns Lyon, who also runs the site taxtuneup.com.

5. Missed Reimbursements

Don't miss those office reimbursement deadlines, because you can't make it up with a deduction.

"If your company has a policy that they will reimburse for certain expenses but you never submit the paperwork for it, you can't deduct those expenses later," she says. "If a company has a policy that they either won't reimburse for expenses or they have a dollar limit for reimbursements, then you can deduct it."

by Heather Boerner, for Yahoo! HotJobs
Huaren
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icyscorpio

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2008-03-09 17:45:00

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