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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121177  
Subject: question on business mileage Date: 9/17/2012 12:44 PM
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A friend of mine owns a consignment shop where she gets a lot of her merchandise to sell at various yard sales. In prior years, she has taken deductions for car expenses for the travel to the various yard sales to pick up the merchandise that she sells in her shop. This year, she is having her taxes done by someone different, and that person is saying that she cannot deduct that mileage because it is treated like commuter miles that are not deductible.

That doesn't sound right to me because the yard sales are not her regular place of business, and she is effectively picking up her inventory, so I would have thought that her car expenses would be deductible, assuming she has all the proper records and such.

She's confused about what to do here, and I thought I would post the question to the board to see if anyone can provide some insight and possibly a reference on the proper way to handle this. Anyone got any ideas on this one?
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Author: CABob Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 116589 of 121177
Subject: Re: question on business mileage Date: 9/17/2012 1:11 PM
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I will be interested to hear what the experts have to say, but, my thinking is that if she is going from her home to the yard sale it would be like commuting. If she is going from her shop to the yard sale then returning to the shop it might be a business expense.

Bob

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Author: dusty2004 Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 116590 of 121177
Subject: Re: question on business mileage Date: 9/17/2012 3:41 PM
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The main issue for me would be documentation.

The trip from home to the first yard sale would be commuting.  If she 
leaves from her store that that would be business miles.  She needs to 
keep a mileage log.  I tell my clients to keep it simple.

Date  Starting odometer reading  Where traveled and why  Ending odometer reading

The last trip from a yard sale to home would also be commuting.  If it 
is to the store then it would be deductible.

Dusty


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Author: irasmilo Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 116594 of 121177
Subject: Re: question on business mileage Date: 9/17/2012 10:06 PM
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A friend of mine owns a consignment shop where she gets a lot of her merchandise to sell at various yard sales. In prior years, she has taken deductions for car expenses for the travel to the various yard sales to pick up the merchandise that she sells in her shop. This year, she is having her taxes done by someone different, and that person is saying that she cannot deduct that mileage because it is treated like commuter miles that are not deductible.

I disagree with the previous responses. If she runs a consignment shop, that is her regular place of business. Of course, she could have other regular places of business if she has other business ventures. Trips from her shop to other locations to purchase inventory should be fully deductible. The only commuting expense would be between home and the consignment shop.

Ira

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Author: Jeanwa Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 116596 of 121177
Subject: Re: question on business mileage Date: 9/18/2012 5:00 AM
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This year, she is having her taxes done by someone different, and that person is saying that she cannot deduct that mileage because it is treated like commuter miles that are not deductible.

============================

I would add that part of the reason for getting your taxes done by a professional is so they can discuss /explain the reasoning with the IRS.

If the IRS questioned this deduction, I wouldn't want a tax prep person saying, "I told them you it wouldn't be allowed." I would want them to explain why it is allowed.

I couldn't find specifics in IRS Pub 463 but,

http://www.bizfilings.com/toolkit/sbg/tax-info/fed-taxes/bus...

travel from your office or business location in order to perform business tasks, such as to pick up supplies and inventory, to check your business post office box, or to make a bank deposit;

Jean

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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 116599 of 121177
Subject: Re: question on business mileage Date: 9/18/2012 11:06 AM
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I would add that part of the reason for getting your taxes done by a professional is so they can discuss /explain the reasoning with the IRS.

Thanks. I think I will tell her to ask the preparer some more questions. I know that she's using a tax professional, but I think it's more like one of those H&R Block type tax services, so maybe that's why she's getting different answers from different people.

travel from your office or business location in order to perform business tasks, such as to pick up supplies and inventory, to check your business post office box, or to make a bank deposit;

Thanks for the pointer as well. I will send this information as well as the feedback from the other folks on this thread to her and tell her to push on this and ask more questions.

Thanks to all for the help here.

Regards,
Cathy

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