Tax Deductions

[pegasus]

Hello fellow aviators!

Apart from uniforms, dry cleaning, medical, equipment needed for the job (headset, luggage etc), what else is tax deductible for the airline pilot? I have heard varying opinions regarding crash pads, parking fees, tips, taxis/light rail to and from the crash pad.
One Captain recently informed me that since we have to abide by governmental regulations we are entitled to an additional tax break. Sounds dodgy to me. Any clues?
Cheers.

 

[STL717]

For expense purposes your tax home is your domicile. If you commute, any expense incurred while at the domicile such as crash pad, hotel room, food, and transportation is NOT deductible. Transportation from home to the domicile is not deductible. If you have a second job in another location you may be able to deduct transportation.

See IRS PUB 529

and PUB 463

 

[TheRealStory]

Since your tax home is your domicle should you file your taxes there. (i.e. Florida vs a state that has a state income tax)?

 

[trainerjet]

If you read the pubs to which STL717 provided links, it will help answer your question. Notice, he said "for expense purposes", your tax home is your domicile.

You should be very careful when deciding what is your "tax home" for income tax puposes. Ask the Northwest pilots who were claiming residence in Florida all those years while living and working in Minnesota.

 

[skiddriver]

You can claim the differential between per diem allowed and per diem paid by your company as a business expense. Just be careful how you compute the allowance, and remember that the day a trip starts and the day it ends is allowed at 3/4 of a day per diem at the rate for the city you overnighted.

 

[Wankel7]

I have heard that you can make your haircuts a deduction. Also, moving is a tax write off. I think there are some rules on it.

Any thoughts on that?

James

 

[Indapool]

Pilottax

You staying out of trouble?

Don't forget to deduct your internet sevice, Wbid, Moostro etc..

 

[jaxgus]

Good Website

Try www.flightcrewtaxes.com

They have a great spread sheet to help itemize deductable items.

 

[Michael Knight]

Some of the info posted here is correct but be sure to use software and/or read the IRS pubs before putting yourself in harms way with the IRS. tax4crews and other tax preparers that specialize in airline employee taxes may be the way to go.

Definitely no to commuting expenses and crashpads.

Just remember, you need to exceed 2% of your Adjusted Gross Income (AGI) before anything is deductible. So, if you make 25K you could deduct everything after $500. So, if you have $700 in deductible expenses and a 25K salary you would end up being able to deduct $200. This is addressed under Job Expenses and Most Other Miscellaeous Deductions if you Itemize. If you don't Itemize than you likely won't exceed the new standard deductions anyway.

Again, if you make 50K you would need to top $1000 in deductible expenses before you could even deduct $1. Anyway, you can do the math.

The Northwest pilot got in trouble by claiming he was a FL resident when in fact he was not. If a state believes you should pay them taxes they will look at several things to determine residency. Some of these things are: property ownership, state driver's license, vehicle registration, voter registration, and mailing/physical address. So, generally a resident will have the majority of these things in their state of legal residence. This is how one establishes legal residence. It isn't that hard to figure out when someone is lying to cheat their state out of taxes.

 

[pilot141]

Huh. A couple of guys have been encouraging me to deduct crash pad expenses on this years taxes.

So crash pads are a no-go, always? Even in an involuntary displacement scenario?

I know a lot of guys who could get caught speeding on this one.

As to the domicile thing, it has gone both ways. The Northwest guy(s) were busted while trying to claim their NW domicile as their legal residence even though they commuted. But didn't the state of Georgia try to come after all the Delta guys that worked in Atlanta but lived in other states? The pilots paid state income taxes in state X but Georgia claimed that they owed taxes there as well. IIRC the state lost that one.

So: you pay income taxes based on where you actually live.

If you choose to commute, that base becomes your "workplace" as far as expenses are concerned. So, expenses incurred while getting to or while at "work" are not deductible, much like average Joe driving to work can't deduct the cost of his mortgage or car payment.

Correct or not?