A commute to work can vary greatly. Some entrepreneurs walk a few steps into their convenient home offices, while others drive two hours to get to an office or outdoor job site. In honor of National Bike to Work Day, 1-800Accountant offers the following transportation tax tips and money-saving strategies for both individuals and small business owners:
Hop on Your Bike – or Take a Hike
If you own a bicycle, get in the spirit of National Bike to Work Day and pedal to work. Most cities have some type of bike path on the major roads in the area, and you can certainly save on gas as well. Bike riding is good exercise, too. If you don’t have a bike and are not too far from your place of employment, consider walking to work when the weather permits. Nothing is better than a nice morning walk before a long day at the office. Better yet, if you own a home office, your commute may only be from your bedroom to another room in your house. Don’t forget to claim the home office deduction in this case.
Is Public Transit Reliable in Your Area?
Instead of using your car or motorcycle to commute to work or anywhere else, consider hopping on a public bus, train, subway, or cable car in your city. It’s often much cheaper to take a ride using public transportation, as long as it’s reliable. When driving a car, you can rack up a big gas bill and any other expenses you incur to maintain your vehicle. Plus, using public transit will reduce the wear and tear on your personal vehicle, which can help it last longer.
Think back to when you were a kid in school. Perhaps your mom drove you and a few other kids in your neighborhood to school. Why not turn back the clock and apply this same concept to your current work life? If you have coworkers, employees, or others nearby who travel to the same location as you each day, consider carpooling. You could set up a schedule where everyone participates equally. The financial savings of carpooling over time can be tremendous.
Transportation Tax Deductions
You may be able to write off some of your transportation costs as a tax deduction. If you are self-employed and use a personal vehicle for business purposes, you can deduct gas, tolls, vehicle maintenance, insurance, and other expenses. There are two options on the vehicle deduction – miles driven and actual expenses. The standard mileage rate for 2014 is 56 cents per mile, or you can claim total expenses. Additionally, any cab fares or other costs you pay related to conducting your business locally and in other areas can often be written off as a tax deduction.
Save Your Receipts
The IRS must verify that any transportation expenses you claim as a tax deduction do indeed qualify for a write-off. For small business owners, this means they should be related to conducting business. That’s why it is so important to hold on to your receipts. Keep them organized in a folder, or scan them to save on your computer as well. The last thing you want is to have a huge travel bill without the proper paperwork to back it up so you can write it off.
For more transportation tax tips and ways you can save money, turn to 1-800Accountant. Call 1-888-749-0117 or visit www.1-800Accountant.