One exception, the so-called home-office exception, requires that a taxpayer's residence be his or her principal place of business. See Strohmaier v.Commissioner, 113 T.C. 106, 113-114 (1999); Curphey v. Commissioner, 73 T.C. at 777-778. It allows a deduction for commuting expenses incurred between the taxpayer's principal place of business (his or her residence) and another place of business.
If one of the places of business is the taxpayer's residence, however, the residence must be the taxpayer's principal place of business for the trade or business the taxpayer conducts at those other locations. See Strohmaier v. Commissioner, 113 T.C. 106 (1999). As discussed infra, we conclude that petitioner's residence was not her principal place of business.
To deduct a travel expense, the taxpayer must show that (1) he or she was away from home when he or she incurred the expense, (2) the expense was reasonable and necessary, and (3) the expense was incurred in the pursuit of a trade or business. See Strohmaier v. Commissioner, 113 T.C. 106, 115 (1999); see also Commissioner v. Flowers, 326 U.S. at 470. A taxpayer is considered "away from home" within the meaning of section 162(a)(2) if the taxpayer is on a trip that requires the taxpayer to stop for sleep or a substantial period of rest.
After all, there was no need for him to stop and rest when traveling between his residence and the clinic. See United States v. Correll, 389 U.S. 299 (1967); Strohmaier v. Commissioner, 113 T.C. 106, 115 (1999). --------
Expenses for transportation between a home office and another place of business, however, may be deductible if the home office is the taxpayer's principal place of business. Strohmaier v. Commissioner, 113 T.C. 106, 113-114 (1999); Curphey v. Commissioner, 73 T.C. 766, 777-778 (1980); Gosling v. Commissioner, T.C. Memo. 1999-148. We accordingly consider whether petitioner had a home office.
The first exception, that expenses incurred traveling between a taxpayer's residence and a place of business are deductible if the residence is the taxpayer's principal place of business because a home office is located at the residence, is a judicially created exception. See Strohmaier v. Commissioner, 113 T.C. 106, 113-114 (1999); Wis. Psychiatric Servs. v. Commissioner, 76 T.C. 839, 849 (1981); Curphey v. Commissioner, 73 T.C. 766, 777-778 (1980). In the seminal case on the home office exception, Curphey v. Commissioner, supra, the taxpayer maintained a home office in his residence that qualified as his "principal place of business" under section 280A(c)(1)(A).
" In Strohmaier v. Comm'r, 113 TC 106 (1999), the U.S. Tax Court compared the relative importance of an insurance broker's client meetings to his preparatory work at home for purposes of determining his principal place of business under IRC section 280A(c)(1)(A). Under the relevant test for that statute, the "delivery point or facility" of a good or service is a weighty consideration in determining where a business's most important functions are undertaken.
A taxpayer generally must show that he was away from home overnight when the expenses were incurred. United States v. Correll, 389 U.S. 299, 302-07 (1967); Strohmaier v. Commissioner, 113 T.C. 106, 115 (1999). For present purposes, our consideration is limited to Mr. Harwood's work for Abacus, Day & Zimmerman, and Charter Mechanical as well as his 2016-17 work for Temp. Control, i.e., jobs for which he stayed overnight away from Yakima.
But if one of the places of business is the taxpayer's residence, the residence must be the taxpayer's principal place of business for the trade or business the taxpayer conducts at those other locations. See, e.g., Strohmaier v. Commissioner, 113 T.C. 106 (1999). Petitioners have not produced adequate records or, at a minimum, any evidence to corroborate petitioner husband's statements regarding the car and truck expenses.
But if one of the places of business is the taxpayer's residence, the residence must be the taxpayer's principal place of business for the trade or business the taxpayer conducts at those other locations. See Strohmaier v. Commissioner, 113 T.C. 106 (1999); Curphey v. Commissioner, 73 T.C. 766, 777-778 (1980); Beale v. Commissioner, T.C. Memo. 2000-158, 2000 WL 631398, at *5-*6; cf. Mazzotta v. Commissioner, 57 T.C. 427, 429 (1971) (holding that a taxpayer could not deduct expenses for traveling between his residence and his employment merely because he conducted a second business at home), aff'd, 467 F.2d 943 (2d Cir. 1972). In addition, a taxpayer may deduct the entire cost of "section 179 property" as a current expense for the year the property is placed in service.