Tax Deductions

[Michael Knight]

pilot141,

You are absolutely correct.

 

[STL717]

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?

Correct!!!!!!!!!!!!!!!!

Expenses are deductible when you are away from your domicile. If you get to layover at your real home because you're a commuter. The expenses incurred are deductible just like any other layover. But.... while at the domicile no expenses are deductible. This all deals with business expenses.

Your income taxes are filed based on where you live.

Read the 2 IRS publications above, they will explain all of this.

 

[pegasus]

Thanks

Thanks everyone for all the advice. I shall not be deducting my crash pad.
Good job I have another business on the side.

But that makes it all the more complex.

 

[PTinbound]

I just wanna know if a SWA class date is tax deductible.

 

[AKAAB]

Shoe shines and dry cleaning uniforms = deductible.
Haircuts = not deductible.

I was looking this up a couple of years ago and found an case against a pilot that involved his deductions. The ruling was as stated above and his haircut deductions were disallowed.

AKAAB

 

[buzzfly]

On the flight crew website, a deduction is listed for loss of license/medical insurance. Can you deduct your health insurance? Seems like a stretch.

 

[Michael Knight]

ah... no.

 

[dixieflyer]

Can anyone here confirm the legality of writing off Loss of Licence and Loss of Medical Insurance? I haven thought of that one. Can you write it off at 100% Or is it only a partial write off?

Thanks in Advance

 

[Snoopy58]

dixie,

If you are able to do that (and I'm not claiming that it's allowed), it seems that then, should you go out on LOL, then your insurance benefits would be taxable where they otherwise wouldn't be.

We had such a discussion at my airline recently; the current plan is that LOL benefits (which come from the company -- it self-insures for pilots' Loss of License) are taxed as income. There was an option out there to transform the program into one which paid the benefits out tax-free, but the COST (to us) of such a program was that, even though we wouldn't be paying premiums (just as we don't now), the value of the premiums would be treated as "imputed income" to us, since the company would be in effect giving us the value of such (theoretical) premiums. Thus, we'd ALL pay higher monthly income taxes under the "tax-free LOL proposal" than we do now. Some sharp people looked at the numbers closely, and the proposal was voted down.

The relevant point being, if your LOL benefits come to you tax-free, then the premiums paid for them will be paid from post-tax income (our proposed plan, and your current situation, it sounds like). It would seem logical that if you deduct your LOL insurance premiums, then the benefits, should you get them, would be taxable income (which is more or less our current situation -- the insurance is part of our compensation, and the notional "premium payments" aren't something we pay, nor pay tax on). Depending on your financial state, that might not be something you'd want to do. You may need all the LOL payments your insurance gives you if you go out on Loss of License.

Or it might be something you would like to do. *IF* such a move would be allowable for you. Our program is clearly different from yours, and I'm not giving you tax advice! Just food for thought.

Snoopy

 

[dixieflyer]

Snoopy,

Thanks for the insight. Your correct, our LOL benefit programs are different. As an ALPA member we recieved a certain amount of LOL benefits. I have been paying about $70 a month for "extra" coverage, should I lose my medical. This extra coverage includes both lump sum and monthly payments. I guesse what I was wondering was could I write off the $70 a month in extra insurance. Any thoughts?

Thanks in Advance