Tax deductions for mileage when managing property for parents?

Question

Hi, my parents live in California and recently purchased two investment properties in Atlanta, GA. I am taking care of the properties for them (repairs, getting tenants, etc.). My parents are not paying me as a property manager and I don't want to be paid because I don't want to deal with California state income taxes or other additional tax burdens (and more so, because they are my parents). But I'm wondering if there is a way my parents or I can claim mileage deductions on taxes for my travel related to taking care of their properties. Has anyone dealt with this issue before? I wasn't able to find anything from an Internet search...

Bill Hampton · Answer

@Ellen Cheng

That's a good question. They could pay you as a contractor, deduct the expense and no 1099 is required if the amount is under $600. However, you are required to report all income, even if it's under $600.

The other option is they don't pay you and nobody reports a deduction or income.

Good luck.

Ellen Cheng · Answer

Thank you Bill and Jason! That’s a good idea, I had not thought of that!

Jason Malabute · Answer

Hi Ellen, typically, to claim mileage deductions on your taxes for travel to properties, you would need to either own the property or it would need to be your job, like if you were hired as a property manager. In your case, since your parents own the properties and you’re helping them out, you may not be able to claim those deductions unless they pay you for your services. As Bill suggested, one way to handle this could be for your parents to pay you as a contractor. That way, you could claim the mileage as a travel expense for the work you’re doing on their behalf. And just like Bill said, if they pay you less than $600, they don’t need to issue a 1099