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  1. #1
    Join Date
    Dec 2011
    Posts
    15

    Default Vehicle Operating Allowance

    My question involves bankruptcy in the state of: Wisconsin.

    The IRS operating allowances are very low compared to my actual costs. Can I use my actual expenses to determine what my DMI will be? I mean I don't know how they expect you to get to work if I don't have enough gas to get there.

    Needless to say I'm freaking out about this....

    Help?

  2. #2
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Vehicle Operating Allowance

    The IRS mileage rate is 55.5 cents per mile. At present rates, applying that amount solely to gas, you would have to be getting less than 6 MPG for that allowance to be insufficient to cover gas. (Are you driving an RV or a Hummer?)

    What amount do you believe is reasonable in your case, and on what basis?

  3. #3
    Join Date
    Dec 2011
    Posts
    15

    Default Re: Vehicle Operating Allowance

    It's my understanding the operating allowance in my area is $212.00 a month. I have never heard the 55.5 cents per mile. Hmm..

    There is no way gas/insurance/registration/maintenance fees will be covered by $212.00.

  4. #4
    Join Date
    Sep 2005
    Location
    Behind a Desk
    Posts
    98,846

    Default Re: Vehicle Operating Allowance

    I thought you were referring to mileage allowances. I see you mean this. If the trustee's default is to use the operating costs charted by the IRS on that page, make your case that it's not a reasonable standard in your case. I expect that [(miles I driver per month, backed up with documentation) x 55.5 cents per mile] would be decent evidence that a higher amount is appropriate. Even the IRS makes allowances ("If the amount claimed for Ownership Costs, Operating Costs or Public Transportation is more than the total allowed by the transportation standards, the taxpayer must provide documentation to substantiate those expenses are necessary living expenses.").

  5. #5
    Join Date
    Dec 2011
    Posts
    15

    Default Re: Vehicle Operating Allowance

    Thanks. It won't be an issue documenting. I think the allowances were created when gas was $1.00 a gallon or something. I'm getting a car that gets over 30 miles per gallon, and still won't be under $212.00 with all expenses.

  6. #6
    Join Date
    Sep 2011
    Location
    OH10
    Posts
    17,019

    Default Re: Vehicle Operating Allowance

    You are not supposed to deduct expenses to go to work. You are supposed to deduct expenses related to business use of the vehicle. Before you cry too loud, my families work commute expenses were running about $8,000 a year and were not deductible. Here is a link to the IRS site covering it.

    http://www.irs.gov/taxtopics/tc510.html

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