What Qualifies as Tax Deductible Business Travel Expenses Many taxpayers travel for work, they go away on an overnight trip as part of doing business, and many expenses incurred during travel are tax deductible.
Whether the taxpayer is traveling as an individual (i.e. for their own business) or as an employee of another business, the IRS has defined rules about what qualifies as business travel, and business travel expenses.
Business travel is defined as any travel that the taxpayer does away from their home, for work purposes, that includes overnight stay as a requirement to meet the demands of the work. If the travel does not include overnight stay, then the incurred expenses do not qualify as a business related travel expenses. For details about what the IRS defines as “away from home” please review the Falcon Expenses Resources post, IRS Business Travel Definition for “Away From Home”.
Deductible Travel Expenses Include:
- Travel by airplane, train, bus or car between the taxpayers home and business destination.
- When the taxpayer travels with their own car while at a business destination the actual expenses or the standard mileage rate deduction can be used; more information on these methods can be found in the Falcon Expenses resources post, How to Maximize Business Use Car Tax Deductions. Also, business related tolls and parking fees can be deducted. For rented cars, only the business-use portion of the expenses can be deducted.
- Meals and lodging.
- Tips used to pay for services related to any of the expenses.
- Dry cleaning and laundry.
- Business communications while on trip (i.e. telephone calls, internet, email, faxes, etc.).
- Other expenses related to the business travel such as transportation to and from a business meal, computer rental fees, etc. For meal expenses, instead of keeping records of the meals, the standard meal allowance can be used.
- Baggage, sample or display material shipping fees between regular and temporary work locations. For more information on temporary work locations please review the post, Temporary Work Location Commuting Expenses Tax Deductions.
For further details on record keeping requirements for the above mentioned expense types please review the post, IRS Rules for Recording Business Expenses: Travel, Transportation, Meals and Entertainment.
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