Travel & Entertainment:
Maximizing Tax Benefits
Tax
law allows you to deduct two types of travel expenses related to your business,
local and what the IRS calls "away from home."
First,
local travel expenses. You can
deduct local transportation expenses incurred for business purposes such as the
cost of getting from one location to another via public transportation, rental
car, or your own automobile. Meals and incidentals are not deductible as travel
expenses, but you can deduct meals as an entertainment expense as long as
certain conditions are met (see below).
Second,
you can deduct away from home travel
expenses-including meals and incidentals, but if your employer reimburses
your travel expenses your deductions are limited.
Local Transportation Costs
The
cost of local business transportation includes rail fare and bus fare, as well
as costs associated with use and maintenance of an automobile used for business
purposes. If your main place of business is your personal residence, then
business trips from your home office and back are considered deductible
transportation and not non-deductible commuting.
You
generally cannot deduct lodging and meals unless you stay away from home
overnight. Meals may be partially deductible as an entertainment expense.
Away From-Home Travel Expenses
You
can deduct one-half of the cost of meals (50 percent) and all of the expenses
of lodging incurred while traveling away from home. The IRS also allows you to
deduct 100 percent of your transportation expenses--as long as business is the
primary reason for your trip.
Here's
a list of some deductible away-from-home travel expenses:
·
Meals
(limited to 50 percent) and lodging while traveling or once you get to your
away-from-home business destination.
·
The
cost of having your clothes cleaned and pressed away from home.
·
Costs
for telephone, fax or modem usage.
·
Costs
for secretarial services away-from-home.
·
The
costs of transportation between job sites or to and from hotels and terminals.
·
Airfare,
bus fare, rail fare, and charges related to shipping baggage or taking it with
you.
·
The
cost of bringing or sending samples or displays, and of renting sample display
rooms.
·
The
costs of keeping and operating a car, including garaging costs.
·
The
cost of keeping and operating an airplane, including hangar costs.
·
Transportation
costs between "temporary" job sites and hotels and restaurants.
·
Incidentals,
including computer rentals, stenographers' fees.
·
Tips
related to the above.
If you have any questions, don't hesitate to send us an email or give us
a call.
651-621-5777
No comments:
Post a Comment