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Airline Employee Business Expenses Listed and Explained

airline tax deductions chalkboard

If you are a flight crewmember, you've probably wondered at some point, what airline-related expenses can I deduct from my taxes? Properly deducting airline related employee business expenses each year can save you thousands of dollars in taxes, but researching the rules for deducting airline expenses can be time-consuming. To help you out, we decided to write this article to help you get started.

The IRS says airline flight crews are entitled to certain employee business expenses, and they provide certain tests that must be passed in order to determine if an expense is deductible. Most of this information can be found withing IRS Publication 463 or IRS Publication 529. Knowing these tests is the best place to begin determining whether an expense can be deducted. The tests are as follows:

  1. The expense must be ordinary. An ordinary expense is one that is common and accepted in your field of trade, business, or profession. Examples of ordinary expenses for pilots and flight attendants include items like calculators, a water bottle holder, an id holder, uniform expenses, etc.
  2. The expense must be necessary. A necessary expense is one that is helpful and appropriate for your business. An expense does not have to be required to be considered necessary. If an expense passes the ordinary test, ask yourself is it necessary (i.e. helpful and appropriate for your business.) The four example expenses listed above are all helpful and appropriate, and they therefore pass the necessary test.
  3. The expense must not be personal. A personal expense is one that you would likely have incurred even if you were not employed. If an expense would only have been incurred because of the job, it then passes the ordinary test. Examples that crewmembers often try to deduct, but fail the ordinary test are socks, underwear, haircuts, and wristwatches. None of these items can be deducted. Obviously they all pass the ordinary and necessary tests, but they all fail the personal test. You would incur the expense even if you weren't employed. Wristwatches are specifically listed in the tax code as a non deductible item.
  4. The expense must not be prohibited by the tax code. Sometimes an employee business expense can pass all three of the tests above, yet still not be deductible. Take a wristwatch for example. A wristwatch can certainly be argued to be ordinary and necessary for airline pilot tax or flight attendant tax purposes. Furthermore, a pilot or flight attendant could argue that a wristwatch is not personal because they only bought it because of their airline employment. But unfortunately for all of the airline pilots and flight attendants with expensive wristwatches, IRS Publication 529 of the tax code specifically says that wristwatches cannot be deducted for any reason.

Usually determining whether an expense is deductible is pretty simple, but sometimes the answer is not so clear. Take cell phone expenses for example. For most crewmembers, they typically pass the ordinary and necessary tests. The difficulty comes from the personal test because a typical pilot uses one cell phone account for both personal and business-related phone calls. In situations like that, you must determine the amount that you consider business. That is the deductible amount. The excess personal portion is not deductible.

The Expense Processor provides a simple way to calculate the deductible expenses. It is a checklist and a calculator all in one. It adds all of these expenses for you and then tells you where they go on IRS Form 2106. Items in the Expense Processor are ones that most airline crew employees would consider ordinary.  Whether they are necessary, personal, or non-deductible for some other reason depends on the expense and the unique situation of the person taking the deduction. The items that we include in the Expense Processor are provided below. Again, just because an item is on the list does not necessarily mean it is deductible. You must follow the tests given in this article to help you make that determination, and even then you may have to look more into the tax code for some items.

Only Noncommuting and Nonovernight Transportation Related Expenses
  • Bus Fare
  • Car Rental
  • Parking Fee
  • Taxi
  • Toll
  • Train Fare
  • Trip Pass
  • Other
Travel Expenses You Paid for While Away From Your Tax Home
  • ATM Fees on Overnight
  • Check Cashing Fee on Overnight
  • Internet Access Fee on Overnight
  • Tip for Van Driver (Airport/Hotel Transportation)
  • Washing Clothes on Overnight
  • Other
Job Searching Expenses in Your Present Line of Work
  • Application Fee
  • Car rental for interview
  • Interview prep fee
  • Lodging for interview
  • Other interview realted costs
  • Suit for interview
  • Website subscription for job search
  • Other
Type Rating Expenses
  • Lodging for type-rating (receipt always required)
  • Other type-rating related costs
  • Rental car for type-rating
  • Type rating fee
  • Other
Other Training Related Expenses
  • Books for training
  • Lodging for training
  • Other
Uniform Purchase Expenses
  • Belt
  • Blouse
  • Boots
  • Coat
  • Dress
  • Epaulets
  • Gloves
  • Hat
  • Jacket
  • Pants
  • Scarf
  • Serving Garment
  • Shirts
  • Shoes
  • Skirt
  • Wings
  • Other
Uniform Upkeep
  • Alterations
  • Drycleaning
  • Home Laundering
  • Shoe Repair
  • Shoe Shines
  • Other
  • Alarm Clock
  • Calculator
  • Cockpit Keys
  • Cockpit Supplies, Maps, etc.
  • Company business cards
  • Crew ID Holder
  • Crew ID Tag
  • Curling Iron
  • Flashlight
  • Flashlight Batteries
  • Foreign Visa
  • Hair Dryer
  • Headset/Earpiece
  • International Currency Converter
  • International Voltage Converter
  • Iron (Portable)
  • Jepp Binders
  • Jepp Inserts
  • Jetbridge Keys
  • Logbook software
  • Logbooks, (red & black books)
  • Luggage (rollerboards, suitcase, etc.)
  • Manual Replacement
  • Passport/photo/renewal
  • Personal Organizer
  • Portable Security Device
  • Portable Smoke Detector
  • Sunglasses
  • Wheels for Luggage
  • Other
  • Answering Machine
  • Cell phone purchase
  • Cell Phone Usage Fee (Monthly Bill)
  • Company copy/fax costs
  • Company phone/mailing costs
  • Computer Printer Supplies
  • Internet Fee (Monthly Bill)
  • Other
  • Bid Service
  • Logbook Service
  • Other
Professional Publications
  • Foreign Language Expense
  • Profession-related magazine
  • Profession-related website subscription
  • Other
Profession-Related Fees
  • Drug Testing Fees
  • Dues for Professional Organizations
  • FAA Medical Exam
  • Loss of Licence Insurance (pre-tax only)
  • Union Dues
  • Union Intitiation Fees
  • Other
FFDO Related Expenses
  • Ammunition
  • Carrying Case
  • Clips
  • Document Holder
  • FFDO Lodgin Expenses
  • FFDO Membersips
  • FFDO Publications
  • Holster
  • Holster Belt
  • Medical
  • Range Fees
  • Training Costs
  • Weapon
  • Other

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