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Business Travel Expenses - Rules, What's Deductible, More

Business Travel Expenses: You normally get to deduct ordinary and necessary business-related expenses for traveling away from home, but read on for the rules, details and resources with more.

As the summer break begins to wane and we look at our August calendars approaching school and Labor Day, here's a quick look at taxes and business travel expenses when work is involved. In other words, a summer work trip that may also simultaneously double as a vacation in some way, shape or form. As always, your set of facts and circumstances will come into play on things, but the IRS provides plenty of information on the subject so you can deduct (per eligibility) your expenses appropriately.

First, travel expenses are the ordinary and necessary expenses of traveling away from home for your business, profession, or job. You cannot deduct expenses that are lavish or extravagant or that are for personal purposes. From here and copying from IRS Publication 463, Travel, Entertainment, Gift and Car Expenses, jump to the part that offers a bit more on business trips and personal trips:

"Trip Primarily for Business.  You can deduct all of your travel expenses if your trip was entirely business related. If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct only your business-related travel expenses. These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination."

On the other hand:

"Trip Primarily for Personal Reasons  - If your trip was primarily for personal reasons, such as a vacation, the entire cost of the trip is a nondeductible personal expense. However, you can deduct any expenses you have while at your destination that are directly related to your business. A trip to a resort or on a cruise ship may be a vacation even if the promoter advertises that it is primarily for business. The scheduling of incidental business activities during a trip, such as viewing videotapes or attending lectures dealing with general subjects, will not change what is really a vacation into a business trip."

There are various other things to think about such as your tax home, determining your place of business, type of travel expenses incurred, expenses reimbursed or not, are you an employee or self-employed and so much more. So what are some expenses that may be deductible, you ask? Here from IRS Tax Topic 511  Business Travel Expenses:

Deductible travel expenses while away from home include, but are not limited to, the costs of:

  1. Travel by airplane, train, bus, or car between your home and your business destination. (If you are provided with a ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero)
  2. Using your car while at your business destination,
  3. Fares for taxis or other types of transportation between the airport or train station and your hotel, the hotel and the work location, and from one customer to another, or from one place of business to another
  4. Meals and lodging
  5. Tips you pay for services related to any of these expenses.
  6. Dry cleaning and laundry.
  7. Business calls while on your business trip (This includes business communications by fax machine or other communication devices)
  8. Other similar ordinary and necessary expenses related to your business travel (These expenses might include transportation to and from a business meal, public stenographer's fees, computer rental fees, and operating and maintaining a house trailer)

Instead of keeping records of your meal expenses and deducting the actual cost, you can generally use a standard meal allowance, which varies depending on where you travel. The deduction for business meals is generally limited to 50 percent of the unreimbursed cost.

So, as you can see, there is a lot to think about. To that end, here are more resources available at IRS.gov:

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gay_wayland June 16, 2013 at 06:20 am
when and where is the sale? Where should donations be taken?
Dr. Michele Drake June 19, 2013 at 11:50 am
The benefit garage and bake sale is this Saturday, June 22 from 7 a.m. to noon at 1463 Golden SunsetRead More Drive in San Marcos (San Elijo Hills). Here's the link to the event: http://encinitas.patch.com/groups/events/p/drake-center-garage-sale-to-benefit-autism-therapy-dog_3a2145e8
Dr. Michele Drake June 19, 2013 at 11:50 am
All donated items can be dropped off at The Drake Center, located at 195 N. El Camino Real inRead More Encinitas.
Vicki Campbell June 17, 2013 at 04:42 pm
Prop A will help residents and stop greedy developers from buying city council. Vote YES
Rick Moore June 18, 2013 at 09:27 am
I wholeheartedly agree with the recommendation that folks read the initiative. When you readRead More sections 6 and 9, you will see that Prop A sets a 30-foot or 2-story ceiling across the entire city, overriding lower height limits in many areas. The Downtown Specific Plan limits residences to 22-26 feet, as detailed on the DEMA website, so Prop A would actually allow the building of taller homes. It makes no exemptions or allowances for historic buildings like La Paloma, church towers or other structures over 30 feet high; the only exceptions are medical complexes and public high schools (see clause 6.2). Rebuilding or renovating (more than 50%) would require expensive public votes. Should the SRF be required to pay for an election to rebuild the Lotus Tower? Such contingencies are allowed for in our Historic Overlay Zone, which would clearly be overridden by Prop A. So is the Encinitas Preservation Association's plan to convert one of the boathouses to a museum. Again, Prop A would require an election (see section 4.1, clause e), which the EPA cannot afford. Prop A would thus favor large developers who have the money, time, lawyers and other resources to campaign for their project. How many nonprofits and small businessmen can afford to spend a minimum $30,000 just to get their project on a general election ballot (upwards of $300,000 for a special election like this one)? Yes, folks, please read the initiative, especially Section 9, which lays waste to anything that conflicts with it. That's why this has been dubbed Propzilla. I trust that most Encinitas citizens are smart enough to see that this meausre is deeply flawed, problematic and counter-productive. We can find much better ways to limit growth and preserve community character.
BlueAngel2 June 18, 2013 at 10:20 am
SAVE ENCINITAS FROM RANCID DEVELOPERS. VOTE YES ON PROP A!
BlueAngel2 June 15, 2013 at 09:47 pm
It would NOT surprise me. I thought we dumped Stocks. Why is he still around?
Encinitas YES on A June 16, 2013 at 02:44 pm
My YES on Prop. A sign was stolen yesterday. Other YES on Prop. A signs are disappearing. YetRead More another deceptive and untruthful mailer from the opponents of Prop. A was in my mail box. There's a shrillness and desperation in their opposition. They can't rely on facts and fair play. Polling data not looking good?
BlueAngel2 June 16, 2013 at 03:17 pm
YES ON PROP A will be victorious!
BlueAngel2 June 8, 2013 at 11:20 am
It just goes to show if Stocks or any of his puppets are involved, you will not hear the truth aboutRead More this proposition. They continue to confuse the issue. Please do not throw your vote away to ruin our city and enhance the developer's pockets who do not care what they do to our beautiful Encinitas. Vote YES on PROP A!
Status Quo June 19, 2013 at 11:53 am
Looks very much like your Prop A will pass, though 'BA2's tactic seems to be part of the problemRead More also.
TB-ENC June 7, 2013 at 02:01 pm
How is this not a racist group with Hispanics in California at 14 million second behind whites atRead More 14.8 million. We only need one chamber to represent all Californians.
BlueAngel2 June 8, 2013 at 02:09 pm
So any group other than white is a racist group?
Miranda Klassen June 5, 2013 at 10:39 am
Congrats to all on the groundbreaking. Reesey has done an incredible job with making Lux what it isRead More today!
BlueAngel2 June 4, 2013 at 10:40 am
Vote YES on PROP A! The City Council is not experienced in real estate, zoning, construction orRead More development to make decisions for us.
CardiffCreature June 4, 2013 at 10:44 am
Prop A will not control growth. It will make sure that BOTH the council and the public get toRead More directly weigh in on the deals being brokered between big developers and the city. This won't end the indirect developer subsidies, but it sure will help.
Lynn Marr June 6, 2013 at 02:26 am
Yes, it will help to slow growth, by making sure that the public approves raising height limits orRead More upzoning, for developments over the parameters of a MAXIMUM of 30 ft. and two stories. Lower set height limits will not be repealed, because they are not in conflict with the initiative or the General Plan. David Ahlgren's fear and speculation is not backed up by one single fact. He just raises the usual building industry "mantra" of alleged risks created by unnamed "unintended consequences." Council's attempt at a preemptive ordinance does NOT guarantee that will be placed on the ballot in 2014, and does NOT eliminate other loopholes such as the "less-than-5-acre" exception, the "categorization of intensity of use" exception, and the height limit exception. The only loophole that Council's drafted ordinance affects is Council's ability to vote by a 4/5 supermajority on upzoing if it is done with respect to a "significant public benefit." Not only is Council's recently drafted ordinance NOT guaranteed, in that a future Council could reverse it, if it is not enacted through a public vote, but also Council's attempt at preempting the "right to vote on upzoning and raising height limits initiative" DOESN"T eliminate the other loopholes that still exist in our General Plan, Policy 3.12., which exceptions I've spelled out, here.
Lynn Marr June 6, 2013 at 02:37 am
An initiative to Prop A has worked in Escondido, without any lawsuits. "In the 26-yearRead More history of Encinitas, no council has ever used this provision to approve a major project without first a vote of the people." That's completely untrue. The North 101 and Downtown Encinitas Specific Plans were pushed through by the Planning Department, the Planning Commission and a supermajority of past Council AGAINST the wishes of citizens, against years of feedback from Specific Action Review Committees (Sparc)s and Community Advisory Boards (CABs), who wanted to stay with the limits of the General Plan of two stories, 30 ft, MAX, with certain exceptions, consistent with the Initiative! Just posting your opinion without any supporting evidence, Mr. Stocks, is only hurting your "cause." We and everyone we know, all our friends and neighbors, are voting YES on A! Voting YES is best if you want to take back your ability to help slow growth and to take back local control. Yes on A is a vote for Democracy and against insider influence and spinmaster jive promoted by marketing masters of misinformation, attempting to manipulate the uninformed masses with distortions of the truth. We don't need to be spoon-fed our opinions, but can think for ourselves, and act to protect and preserve our community character and our quality of life.
Greg Hay June 6, 2013 at 07:19 pm
Lies, lies and more lies. That's all the supporters of "No on Prop A" can come up with.Read More Even their slogan is weak and devoid of anything of substance… "It's not what it seems"… Really, THAT'S your argument against it?
BlueAngel2 June 6, 2013 at 07:22 pm
YES on PROP A which is NOT deeply flawed and very well written.