Taxes?

[travrussell]

Does anyone have any info on commuter hotel/ crash pad tax write offs. My accountant is telling me we can't write off the hotels as a biz expense because we are based in that city but choose to live elsewhere. Has anyone else been told otherwise, that seems crazy to me.

 

[regionalcap]

I've always been told that you cannot write it off.

 

[FDXer]

Tip number 1. Never ask a pilot financial or tax advice! Listen to your accountant.

 

[Fox-Tree]

Does anyone have any info on commuter hotel/ crash pad tax write offs. My accountant is telling me we can't write off the hotels as a biz expense because we are based in that city but choose to live elsewhere. Has anyone else been told otherwise, that seems crazy to me.

Yes, that is correct advice. You choose to commute and your base city is your place of employment. With all the IRS stuff on line now, it's actually pretty easy to find the rules, etc. about travel and commuting.

One thing you need to do as an airline pilot these days is claim your per diem expenses. It used to be a wash if you were flying mostly domestic. The domestic government per diem rates have been raised significantly over the last couple of years.
Basically, you figure the per diem you would have gotten in each city you layover in using the government rate. Take the difference between that figure and what you got from your company in per diem. You can claim 75% of the difference as a "meals and incidentals" expense.

Don't bother doing all that yourself. Go to pro-diem.com and for $50 they will do all your calculations for 2007. You just send them your trip recaps for all your 2007 flying and in about 2 days, they'll send you all the info you need. I did my own calculations and got $8800 using the government rates. They came up with $10400. Well worth the $50 to let them work their magic.

If you already knew all that, then disregard. I got on a roll.

 

[FlickerFade]

Yes, that is correct advice. You choose to commute and your base city is your place of employment. With all the IRS stuff on line now, it's actually pretty easy to find the rules, etc. about travel and commuting.

One thing you need to do as an airline pilot these days is claim your per diem expenses. It used to be a wash if you were flying mostly domestic. The domestic government per diem rates have been raised significantly over the last couple of years.
Basically, you figure the per diem you would have gotten in each city you layover in using the government rate. Take the difference between that figure and what you got from your company in per diem. You can claim 75% of the difference as a "meals and incidentals" expense.

Don't bother doing all that yourself. Go to pro-diem.com and for $50 they will do all your calculations for 2007. You just send them your trip recaps for all your 2007 flying and in about 2 days, they'll send you all the info you need. I did my own calculations and got $8800 using the government rates. They came up with $10400. Well worth the $50 to let them work their magic.

If you already knew all that, then disregard. I got on a roll.

That's what I do, but why waste $50? Just keep track of where you layover, minus any per diem, you get meal and room rate for your base (where your crashpad or hotel you pay for are). Then look up the rates yourself.

For 2007 I got about $17K in wrote offs.

My tax guy is a former IRS guy and pretty conservative.

 

[regionalcap]

That's what I do, but why waste $50? Just keep track of where you layover, minus any per diem, you get meal and room rate for your base (where your crashpad or hotel you pay for are). Then look up the rates yourself.

For 2007 I got about $17K in wrote offs.

My tax guy is a former IRS guy and pretty conservative.

What do you mean by getting meal and room rate for your base? You do not claim anything while you are staying at that crashpad. Maybe I'm just misunderstanding your post. Also, it's not as easy as just taking the per diem difference. You can only claim 3/4 day for the first and last. Then you can only use 75% of the difference in per diem.

 

[Fox-Tree]

That's what I do, but why waste $50? Just keep track of where you layover, minus any per diem, you get meal and room rate for your base (where your crashpad or hotel you pay for are). Then look up the rates yourself.

For 2007 I got about $17K in wrote offs.

My tax guy is a former IRS guy and pretty conservative.

If you're saying you claim a deduction for your domicile city when you're in your crashpad, you are wrong. I don't care who your tax guy used to work for. You work there, you are based there, you choose to commute. Obviously, you can do what you want, but be careful. You’re getting some questionable advice. With so much info available on the net from the IRS, it’s pretty easy to look up the rules and check for yourself.

When you say you got $17K for a write off, is that the 75% of the shortfall on your per diem you actually entered on your tax form? If so, you must have flown a ton of international and not gotten much per diem from your employer. Wow.

Why spend the $50. Because I used to do the calculations as you describe too. I did them this year and compared the results with what I got from pro-diem and they beat me. They won't tell the exact method they use. I know mine is extremely accurate because Fedex provides me with a per-diem recap that lists times down to the minute that I'm in each city. The IRS has looked at and approved whatever method they do use and it ends up saving me money and time to spend the $50 and use their numbers. That's why.

You don't have to use the 3/4 day convention if you don't want to. The IRS allows you to pick whatever method you would like to figure partial days as long as it makes sense and you’re consistent. Since many of our trips have 20-23 hours TAFB, I used actual time away converted to days and/or a fraction of a day. Pro-diem still beat my calculations, somehow.
It may be worth looking into, especially if you fly international a lot.

Cheers