• Blue_Morpho@lemmy.world
    link
    fedilink
    arrow-up
    1
    ·
    2 months ago

    I claimed that a garage sale was a business activity.

    You can’t deduct housing for a garage sale as you claimed.

    The fact that the IRS requires your regular commute and other expenses to be included in your negotiated pay as a W2 employee means that your expenses are effectively considered “reimbursed”.

    They specifically say you can’t deduct even if the employer doesn’t reimburse.

    “Employees can’t deduct this cost even if their employer doesn’t reimburse the employee for using their own car.”

    https://www.irs.gov/newsroom/heres-the-411-on-who-can-deduct-car-expenses-on-their-tax-returns

    So the IRS does not consider your salary as including reimbursement for transportation.

    “you can work as a 1099 contractor rather than a W2 employee.”

    Companies do not offer that choice to everyone.

    • Rivalarrival@lemmy.today
      link
      fedilink
      English
      arrow-up
      1
      ·
      edit-2
      2 months ago

      You can’t deduct housing for a garage sale as you claimed.

      Your own link says that I can, especially when you get around to acknowledging that the garage sale was just one small business activity of the whole business I described. I included “online retail” as an additional business activity specifically because I thought you would have a problem with the garage sale alone. I’ve already addressed your “garage sale” concerns; I addressed them before you raised them. Your own link says I can deduct from my housing costs the percentage of the house I use for business purposes. It specifically says I can use any “reasonable method that accurately reflects your business-use percentage” to make that determination.

      They specifically say you can’t deduct even if the employer doesn’t reimburse.

      The IRS basically acts as though your regular pay specifically includes reimbursement for your regular commute. Your regular commute is already paid for with your pay, which is why you can’t claim it. The pay you negotiate with your W2 employer already includes (but does not specifically itemize) reimbursement for your regular commute. That is why you don’t get to separately deduct it.

      Your regular pay does not cover atypical travel. If you are temporarily forced to drive 5 miles further to a different job site, you can claim that additional 5 miles. Compensation for that additional mileage is not included in your regular pay. If that additional mileage is not specifically reimbursed, you can claim it, even as a W2 employee.

      Companies do not offer that choice to everyone.

      Then find a different company. Find three, or ten. You’re a contractor: you provide a contracted service, not your time. You provide it to anyone you want, not just a single company. That’s what it means to be a contractor, rather than an employee. You have the flexibility in defining exactly what business you will be doing. You don’t have to fit the narrow IRS restrictions associated with W2 employment. You operate as a business, and you are taxed as a business.