As the filing deadline draws ever closer, it’s time to review your deductions. Here are reminders on how to take maximum advantage of frequently missed deductions for car expenses.
Did you volunteer to raise funds for charities or to perform other tasks, such as collecting clothing for rummage sales? You cannot take a charitable deduction for the value of your time and services. But your volunteer work does entitle you to claim unreimbursed expenses as an itemized deduction on Schedule A of Form 1040. These allowables include such items as telephone calls, postage and stationery, supplies used in making baked goods for a charity sale, as well as the cost and cleaning of uniforms not adaptable to ordinary wear that you are required to wear while performing services.
An often omitted write-off is for travel to and from your volunteer work. If you use buses, trains or taxis, simply record your fares and claim them as charitable travel. If you drive, claim 12 cents a mile or the actual cost of gas and oil, whichever is greater, plus a separate deduction for parking fees and highway tolls.
The law makes it difficult to take an itemized deduction for medical expenses not covered by insurance, reimbursed by your employer, or otherwise satisfied. These expenses are allowable only to the extent that they exceed 7.5 percent of your adjusted gross income.
Assuming you incur costs that surpass the 7.5 percent threshold, your deductibles include travel for medical reasons to and from doctors, clinics, hospitals and the like. You can claim either 9 cents a mile or the actual cost of gas and oil, with a separate deduction for parking and tolls.
The way the Internal Revenue Service reads the law, medical travel does not include the cost of driving to work when a person is unable to use public transportation because of an illness or disability, notes Steve Friedman, a Bronx, N.Y., attorney.
But the IRS does not always have its way. Consider the unusual case of Mary Bordas, whose face was disfigured when she was thrown through her windshield in an auto accident. Mary underwent 14 plastic surgery operations, and her facial injuries affected her mental condition. Her doctor advised against using public transportation, where she would be exposed to curious stares. He also insisted she drive an auto to visit friends as therapy for her mental condition. Therefore, Mary bought a new Chrysler that she drove extensively for social purposes, as well as between her home and her doctor’s office.
The tax collectors tried to limit her medical transportation deduction to driving to and from medical appointments. But she challenged the feds in the Tax Court and won a partial victory. The court gave its blessing to a deduction for “all the driving she did to alleviate her mental condition.” But there the court drew the line. It refused to allow any deduction for the actual cost of the car.
