Scout

I'm sure this has been answered before, but here goes. I'm new to the airline business so please bear with me. I live in a state that has state income tax, (my tax home) and commute to another state that has no state tax. It's not an easy commute (offline JS) and I end up driving my car about twice a month, 6 hours each way, almost 800 miles round trip! I always commute the day prior and stay in a hotel then return the same day my trip ends. Is ANY of this a deductible expense? (Miles, tolls, meals, hotel and parking) I think I already know the answer.....but someone please enlighten me or point me in the right direction.

Thanks!

sailingfun

You have the correct answer. None of it is deductable. I would consider moving to the tax free state! You will save the commuting expenses and not have to pay state taxes!!!!! A double win!

rickair7777

You might consider getting a crash pad, registering your car(s), and claiming the tax-free state as your residence.

In your case this would probably be 100% legal beacause

1) You work in the tax-free state.
2) Between commuting and flying trips, you probably spend less half of your time in your current home state.

For tax purposes the location of your residence is important...the exact living arrangement, roomates, etc shouldn't matter.

Scout

Sail & Rick, thanks for the info! I'm making my plans for the new tax year now...in the mean time I have 2 houses to sell........ then I'm outta here!

jagbn

Scout (and others)---be very careful about playing games with your state of residence. Rickair's colorful suggestion could land you in a heap of trouble. Just google "Northwest Airlines pilot tax evasion" and read how the State of Minnesota vigorously pursues, prosecutes, and sometimes jails pilots for trying scams like this to avoid paying Minnesota income taxes. It's not worth it. I personally know an NWA pilot who battled with Minnesota on this precise issue. Not an enjoyable experience.

Generally speaking, you have to actually live where you claim your residence for more than half the year (Rickair alluded to this in para. 2). There are many factors that go into determining state of residence--where you title and register your car and get your mail are not going to defeat the fact that you own real property somewhere else, and that's where your family lives.

Oh, and by the way, none of your commuting expenses are deductible. Move to the no-tax state and enjoy all that extra cash, and time off.

rickair7777

Generally I agree, but in the case of a single guy who maintains residences in two states it would be possible to control which one is your residence. A family would probably be a deal-breaker, but other than that roomates don't count...the fact that he has his own appartment (or even condo) in state A and shares a room in state B does not automotically make him a resident of A.

Since he doesn't clearly spend most of his time in A, mailing address, car registration, and driver's license can probably tip the balance to either state. Especially since his job is in state B.

I'm NOT advocating anything shady or illegal, but if you're a single airline pilot in that situation, you can probably control which state you reside in...legally.

However, it's worth noting that there is no standard federal law which defines how residency is determined...this is entirely up to the states. It is possible to end up a legal resident of two states at the same time, and be required to pay taxes to both. The state you are domiciled in already has a foot in the door due to your working there. For this reason, I'm pretty careful about doing things like registering cars in domicile, etc.

Airhoss

Rick,

Unless you are a tax attorney you really shouldn't be giving this kind of advice.

My advice to Scout is to spend the money for a one hour session with a tax attorney and get a professional opinion on the subject.