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Revenue Ruling 99-7:
http://www.taxlinks.com/rulings/1999/revrul99-7.htm
Specifically:
"Rev. Rul. 94--47, 1994--2 C.B. 18, amplifies and clarifies Rev. Rul. 190
and Rev. Rul. 90--23, and provides several rules for determining whether daily
transportation expenses are deductible business expenses under § 162(a). Under Rev. Rul.
94--47, a taxpayer generally may not deduct daily transportation expenses incurred in
going between the taxpayer's residence and a work location. A taxpayer, however, may
deduct daily transportation expenses incurred in going between the taxpayer's residence
and a temporary work location outside the metropolitan area where the taxpayer lives and
normally works. In addition, Rev. Rul. 94--47 clarifies Rev. Rul. 90--23 to provide that a
taxpayer must have at least one regular place of business located "away from the
taxpayer's residence" in order to deduct daily transportation expenses incurred in
going between the taxpayer's residence and a temporary work location in the same trade or
business, regardless of the distance. In this regard, Rev. Rul. 94--47 also states that
the Service will not follow the decision in Walker v. Commissioner, 101 T.C. 537 (1993).
Finally, Rev. Rul. 94--47 amplifies Rev. Rul. 190 and Rev. Rul. 90--23 to provide that, if
the taxpayer's residence is the taxpayer's principal place of business within the meaning
of § 280A(c)(1)(A), the taxpayer may deduct daily transportation expenses incurred in
going between the taxpayer's residence and another work location in the same trade or
business, regardless of whether the other work location is regular or temporary and
regardless of the distance. For purposes of both Rev. Rul. 90--23 and Rev. Rul. 94--47, a temporary
work location is defined as any location at which the taxpayer performs services on an
irregular or short-term (i.e., generally a matter of days or weeks) basis. However, for
purposes of determining whether daily transportation expense allowances and per diem
travel allowances for meal and lodging expenses are subject to income tax withholding
under § 3402, Rev. Rul. 59--371, 1959--2 C.B. 236, provides a 1-year standard to
determine whether a work location is temporary. Similarly, for purposes of determining the
deductibility of travel away-from-home expenses under § 162(a)(2), Rev. Rul. 93--86,
1993--2 C.B. 71, generally provides a 1-year standard to determine whether a work location
will be treated as temporary. The Service has reconsidered the definition of a temporary work location in
Rev. Rul. 90--23 and Rev. Rul. 94--47, and will replace the "irregular or short-term
(i.e., generally a matter of days or weeks) basis" standard in those rulings with a
1-year standard similar to the rules set forth in Rev. Rul. 59-- 371 and Rev. Rul. 93--86. If an office in the taxpayer's residence satisfies the principal place of
business requirements of § 280A(c)(1)(A), then the residence is considered a business
location for purposes of Rev. Rul. 90--23 or Rev. Rul. 94--47. In these circumstances, the
daily transportation expenses incurred in going between the residence and other work
locations in the same trade or business are ordinary and necessary business expenses
(deductible under § 162(a)). See Curphey; see also Wisconsin Psychiatric Services v.
Commissioner, 76 T.C. 839 (1981). In contrast, if an office in the taxpayer's residence
does not satisfy the principal place of business requirements of § 280A(c)(1)(A), then
the business activity there (if any) is not sufficient to overcome the inherently personal
nature of the residence and the daily transportation expenses incurred in going between
the residence and regular work locations. In these circumstances, the residence is not
considered a business location for purposes of Rev. Rul. 90--23 or Rev. Rul. 94--47, and
the daily transportation expenses incurred in going between the residence and regular work
locations are personal expenses (nondeductible under §§ 1.162--2(e) and 1.262--1(b)(5)).
See Green v. Commissioner, 59 T.C. 456 (1972); Fryer v. Commissioner, T.C. M. 1974--77." Gina L. Gwozdz, CPA
http://GLGcpa.com
http://TaxTreasures.com
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