Turbo Tax

[N tha jungle]

will turbo tax help calculate per diem deductions? If not, how do you figure it? Has anyone used www.prodiem.com ?

 

[SkiFishFly]

Related Question

Is there a guide out there about deductions allowed for airline pilots?

 

[EWR_FO]

will turbo tax help calculate per diem deductions? If not, how do you figure it? Has anyone used www.prodiem.com ?

I have used them for the past two years. After I saw the results last year, I did a re-file from the previous three years. It is an outstanding service at a great price. It is a giant difference for international flying, but still worth it for domestic.

 

[ironspud]

I have used them for the past two years. After I saw the results last year, I did a re-file from the previous three years. It is an outstanding service at a great price. It is a giant difference for international flying, but still worth it for domestic.

Let me echo that. I do a lot of international and sent in my spread sheet for the year and in about 2 hours had their printout. Excellent service.

www.pro-diem.com.

I was shocked at how much I can utilise as M&I deductions for the year.

 

[AAflyer]

Ironspud,

What is M&I... Thanks..

AA

P.S. does anyone know if the money I spent on my MEI this past year (to revalidate my CFII) can be used as a deduction. It ran $2000.

 

[Falconjet]

I believe that it is meals and incidentals, but I could be wrong.

FJ

 

[vschip]

Quick question, I'm just a dumb guy who eats and drinks on the road, but I don't keep any receipts, just either pay cash or cc. Do you need any receipts, or does the service just use where you layover, and the amount of time you were there? I went to the web site, and can't quite figure out if you need receipts. Thanks

 

[N tha jungle]

ok, so turbo tax won't calculate perdiem. If i wanted to do it myself, what is the the standard m & ie rate per day for 2005? I've heard $41, $56, even as high as $64 a day( at CPAdaly.com ) I'm not sure where to start. Thanks.

 

[Thedude]

Go to the IRS.gov web site and get Pub 1542 for domestic rates

 

[DorkProp]

Asking tough tax questions on an aviation message board is risky. The IRS has publications for these topics. I've used TurboTax for 10 years and it works great. But you will still need to refer to the appropriate IRS pubs for current deduction rates. They are higher for transprotation employees.

 

[GoABX]

Once you take the difference between the city rate and what you are paid and them multiply by your effective tax rate (15-28%), how much extra are you getting back at the end of the year?

 

[radarlove]

Once you take the difference between the city rate and what you are paid and them multiply by your effective tax rate (15-28%), how much extra are you getting back at the end of the year?

None. The guys that brag about using the Transportation Worker per diem deduction are the ones that 'forget' to include the amount of per diem that they got paid by their company. Unless it's terribly low, you don't come out ahead.

Unless...you include the hotel expense and forget to mention the fact that your company paid for the hotel.

 

[Blue Dude]

I'm with radarlove on this one. Since you only get to deduct a percentage of the difference between the allowance and your per diem, if your per diem is too high, you get to deduct nothing. If you only fly domestic, and your per diem rate is much above $1.60 an hour (and that's most of us), then you will get little or nothing for a M&IE deduction. It's to the point that I don't bother keeping records anymore and just accept the fact that I "make" too much in per diem to make it worth my while to even try.

 

[Capt.LongThrust]

Like the earlier post stated unless you do international stuff the difference is not that big. I think London is around $150 a day. So at 2.50 an hour you are still not getting it all. Also remember if you commute, that you can claim 75% of the allowable on the first day and last day. If you do commute on the day your trip starts and ends then you can still only claim the 75% allowable, therefore hurting you a bit.

 

[ironspud]

Like the earlier post stated unless you do international stuff the difference is not that big. I think London is around $150 a day. So at 2.50 an hour you are still not getting it all. Also remember if you commute, that you can claim 75% of the allowable on the first day and last day. If you do commute on the day your trip starts and ends then you can still only claim the 75% allowable, therefore hurting you a bit.

Which is why pro-diem is so good. It does mean downloading their spreadsheet (free) and completing it for a whole year (probably 2-3 hours work, if your personal logbooks are up to date). But they take into account commute times and IRS city costs. For example, if you are in London for 2 days, and the IRS figures $150 a day for Meals and Incidentals, and you are paid $2/hour per diem by your company, then in theory you can deduct $204 for that trip in Meals and Incidental expense ($300 - $96). In my case for the year it came to $19,900. From that I subtract the $9800 in per diem my company paid me. That's now $10,100 in business expense deductions with no receipts required. Of course that is subject to whatever % exclusion the IRS has for business expenses. Don't know what it is this year, I think it was 7.5% last year. But Turbo Tax can figure all that out.

For international flyers it REALLY adds up quickly. I haven't flown domestic for a long time, but do remember the domestic M & I rates as not being really worth the effort to figure it all out. Pro-diem says the IRS has dramatically raised domestic rates recently, and that may make a difference.

This is not hard, but using pro-diem services and good tax softwear can make a significant difference in the size of your refund (or payment due). And they save you the effort of looking up the M&I rates for each city from the IRS publications...and they do change often. Usually monthly. Major pain in the patootie.

PS: Almost forgot. Pro-diem does recognize scheduling softwear from certain airlines. It may make this painless for these folks. Check with them.

 

[Swaayze]

I never bother. RON perdiem is not reported initially, but itemizing would cause those monies to come out of the deductions. I don't really spend a lot on the road so itemizing those expenses just isn't worth the hassel.

 

[Alcatraz]

There are plenty of regional guys making way less than $1.70 out there where this can be a big payoff domestically. Also, new hires at many airlines aren't paid per diem at all during training, and six weeks away from home can add up VERY quick.

And the beauty of it is, you use a STANDARD, government specified deduction for your meals and incidental expenses, which is totally different from what you actually spend. When I've been in initial training for six weeks at a time in various cities without per diem (twice in 2005 for me!), I could lower my actual meal expenses to around $15 a day, but deduct $40-$55 a day using the standard rate. It ends up paying HUGE in certain situations, and you can end up eating for almost free sometimes.

Complicated, though, and time consuming if you do it all yourself like me, but I've gotten a few extra hundred back from the government for doing it in past years. I just spend a few hours on overnights in the spring running numbers from my pay sheets, perdiem sheets, and the IRS pubs.

TurboTax will NOT calculate these amounts on a per-city or per-overnight basis (I haven't used TY2005 yet, though), but it does allow you to input a total number for M&IE, per diem paid, and to specify whether or not you are a transportation employee (which allows you to deduct something like 65% of your net expenses instead of the usual 50%). I've used the "Premier" version for the last several years for unrelated reasons, but I'd bet this feature is in the simpler versions.

 

[COOPERVANE]

Is it also true that CDO's or standups don't allow you to deduct ANY per diem. Someone in another thread that it worked great for pilots who fly standups/high speeds, but the info I have says you don't get any deductions for these trips. Can you list a source that says otherwise?

Believe me, I have been looking.

 

[atpcliff]

Hi!

Go here $ more info:
http://forums.flightinfo.com/showthread.php?t=69146

For the CFI guy: I believe you DEFINITELY can deduct expenses to keep your licenses current, or to upgrade your skills in a job you already have (CFI->CFII or MEI).

You can't deduct training to switch careers. Why, I don't have any idea-it seems like it's better for the government to help you get a new job than to pay your welfare.

Cliff
GRB