All 20 + IRS Travel Revenue Procedures legally defines “Transportation Industry Employees” as follows:

 

"For purposes of this section 4.04, an employee or self-employed individual is in the transportation industry only if the employee's or individual's work (a) is of the type that directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and (b) regularly requires travel away from home which, during any single trip away from home, usually involves travel to localities with differing federal M&IE rates.   For purposes of the preceding sentence, a payor must determine that an employee or a group of employees is in the transportation industry by using a method that is consistently applied and in accordance with reasonable business practice."

Special Note to Locally Based CFI's

While the above definition of "Transportation Industry Employees" includes traveling pilots, CFI's that routinely work with students at local FBO's do not routinely qualify for travel deductions.  The reason - centers on the word "travel."  To "travel" for tax purposes means you are away from home long enough to require you to stop for "rest or sleep."  Merely going up for an hour or two with a student pilot does not qualify you for travel expenses.  If your situation is different, please give us a call for a further discussion.

The same disqualification for travel expenses also applies to local bus drivers working around a city.  These city bus drivers do not "travel" whereas a Greyhound bus driver going between Chicago and Dallas is "traveling" because he needs to stop for "rest or sleep" before returning home.

If you are still confused, just give us a call.