Question

During the year 2019, Ricki, who is not self-employed and does not receive employer reimbursement for business expenses, drove her car 5,200 miles to visit clients, 10.200 miles to get to her office, and 500 miles to attend business-related seminars. All of this mileage was incurred ratably throughout the year. She spent $330 for airfare to another business seminar and $210 for parking at her office. Using the automobile expense rates in effect for 2019, what is her deductible transportation expense? Deductible transportation expense $ 10,080

Answer 1

Answer :-

Deductible Transportation Expense - $3,636

Explanation -

The 5,200 miles to visit clients and 500 miles to attend business related seminar is included in deductible transportation Expenses. And spent $330 for airfare to another business seminar included in deductible transportation Expenses as Ricki is not self employed.In deductible transportation expenses, Ricki only includes miles and Expense used for business purposes.It will not include 10,200 miles and $210 for parking.

Automobile Expense rates in effect for 2019 is 58 cents or 0.58 per mile for business miles.

Total miles used for business purposes = 5200 miles + 500 miles

Total miles used for business purposes = 5700 miles

Mileage Expense = Total miles used for business purposes × Automobile Expense rates

Mileage Expense = 5700 miles × 0.58 = $3,306

Airfare for Business seminar = $ 330

Deductible Transportation Expenses = Mileage Expense + Airfare for Business seminar

Deductible Transportation Expenses = $3,306 + $ 330

Deductible Transportation Expenses = $3,636