Few people enjoy thinking about taxes, especially during the off-season, but a little bit of thought in the off-season can save you a lot of time and money come next tax season. EZPerDiem.com wants to give you a little "food for thought" with regard to next year's taxes. Flight crewmembers have all of the normal tax-related issues that ordinary taxpayers have, with one added component, employee business expenses. In order to get the most money back, these simple tips will help:
TIP #1: If you have the option, try to fly multiple-day-trips rather than day-trips. When you fly a day-trip, you are not only spending more of your own money getting to and from the airport, but you are missing out on one of the biggest deductions that airline pilots are entitled to receive - the per diem deduction. The per diem deduction refers to writing off M&IE expenses while on work-related overnight travel. If you only fly day-trips without layovers, you are not meeting the IRS's rest requirements that are necessary to deduct your meals. In other words, you are giving up a significant amount of money in the form of a tax refund when you elect to fly day-trips. This only applies if you itemize.
TIP #2: Log your overnights in EZPerDiem.com during the year. Each time you fly a trip, you can store the overnights into the per diem calculator as they occur rather than waiting until tax season is upon you. You don't have to pay for this either. Payment is only required when you are ready for the calculations, and that data isn't available until tax season. Entering your airports early will help make next tax season simpler.
TIP #3: Record your other unreimbursed aviation-related expenses. Your union dues, the business portion of your cell phone bill, uniform expenses, and even van-driver tips are employee business expenses that also end up on IRS Form 2106 along with your M&IE. Proper record-keeping today will save a lot of aggravation later.
TIP #4: Buy a house. Houses are cheaper than ever, so if you are in the market for one, the mortgage interest is an itemized deduction, and it is necessary to itemize in order to benefit from the per diem deduction or any other employee business expenses. Of course it is never a good idea to buy a home for tax reasons, but the tax benefits are at least an added perk to home-ownership.
These tips combined with good practices for your other tax-related circumstances should help next tax season be a breeze.
EZPerDiem helps pilots and flight attendants with their flight crew taxes by:
If you do not benefit, we will provide a 100% refund!