Unless moving expenses are involved, Lyle’s expenses will be deductions
Therefore, the deduction would not be available if the standard deduction is claimed.
Also, Lyle’s expenses will be subject to the 2%-of-AGI limitation.
would be reported on Form 2106 and transferred to Schedule A.
Joan’s expenses are
AGI and should be reported on Schedule C.
Lyle will be subject to FICA,
whereas Joan is liable for the self-employment tax.
pp. 9-3 and 9-29
Each stylist should pay a set rental for the use of the facility.
Except for controlling the
hours when the salon will be open, Bernard should allow each stylist to determine his or
her own working hours.
Each stylist should handle customer appointment and billing
To the extent feasible, stylists should provide their own tools and supplies.
Preferably, each stylist should have a separate telephone.
Except in the interest of public
health or safety, Bernard should exercise no control over the clientele of his stylists.
Alexis can claim the mileage from her home to the client locations.
The mileage to and
from the university qualifies as an education expense.
p. 9-15 and Examples 7 and 27
In terms of income derived, the newspaper column he writes predominates.
column is written at home, this would be considered his tax home.
In this sense, the trips
to the university can be regarded as going to a second job.
Consequently, the use of his
car for this purpose should be deductible.
pp. 9-5, 9-8, and Example 5
From the facts given, it appears that Emma has
claimed any deduction for the
business use of the auto.
If she has already filed for year 2003, an amended return
claiming the deduction is appropriate.
Due to an absence of records, Emma cannot use
the operating cost method of determining the deduction.
Consequently, the automatic
mileage method should be chosen.
Emma can prove the miles driven and the percentage
of business use.
pp. 9-6 and 9-7
Tyler’s deductible expenses include transportation and meals and lodging for the entire
Expenses attributable to the Cub’s game and the museum trips are personal and are
Because the trip is solely for business and business was conducted on
Friday and Monday, the weekend living expenses are regarded as business expenses.
p. 9-10 and Examples 10 and 20
The main issue to be resolved is the location of Dr. Werner’s tax home.
salary to be more than modest, the tax home probably is the situs of Pelican University.
Thus, Dr. Werner is in travel status when he conducts continuing education programs or
testifies while out of town.
Expenses incurred during a temporary assignment will be treated as if the taxpayer is in
travel status, as the tax home does not change.
If, however, the assignment is indefinite,
the tax home changes to the location of the new assignment.
If the period of assignment
exceeds one year, it is not temporary.
p. 9-8 and Examples 10 and 11