Tax Planning for Travel Expenses

Business Travel Expenses

Comparable to other costs of doing business, you might receive tax deductions for some travel expenses incurred so that you might provided services to clients. However, it is wise to plan business travel for you to maximize your deduction.

As a self-employed business owner, you are permitted to only deduct for your travel costs when the travel expenses are ordinary in nature and essential for servicing the client. Travel expenses the Internal Revenue Service may possibly typify lavish, don’t qualify for a write-off. Although not absolutely guaranteed, these subsequent expenses are commonly tax deductible:

  • Dry cleaning and laundry costs occurred in business travel.
  • Transportation expenses incurred when travelling from a personal home to the client site.
  • Fuel and other automotive costs you pay while working at the client’s location.
  • Meals and hotel costs.

The everyday commute between home and work is for purposes of taxation a personal expense.

Deductible travel expenses demand that you travel more than a short distance from your main office building to provide service to a customer. This will generally mean you’ll have to go beyond the city in which you work or, for small towns, its general surrounding area. Frequently, travel expenses are eligible for write-offs if you have travelled far on long enough that you’ll have to sleep the night.

Yet keep in mind, you can’t be away from your tax home for too long a period, or you might lose the tax deductions. You can write-off travel expenses from temporarily working away from your tax home. However, when you provide services at a client site for an undetermined length of time, you possibly may not be permitted to claim a travel expenses business deduction. This may possibly mean that you might remain at a client site and claim travel expense tax deductions for no more than a year. Now when you can realistically expect you will work there for more than a year, then, you may no longer claim a tax deduction for future expenses of travelling to this worksite.Finally, successfully claiming the travel expense deduction requires recordkeeping. To support your tax deduction, you should maintain all related receipts. And it is helpful to use a log, notebook, or other type of written record to track your expenses.

Meet with your tax accountant for any help regarding these tax deductions and planning.

Kitsap CPAAbout Kitsap CPA
Kitsap CPA+John Huddleston has written extensively on tax related subjects of interest to small business owners. He is a graduate of Washington State University and the University of Washington School of Law.

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!

  • Huddleston Tax CPAs / Huddleston Tax CPAs – Seattle CPAs
    Certified Public Accountants Focused on Small Business
    40 Lake Bellevue Suite 100 / Bellevue, WA 98005
    (800) 376-1785

    Huddleston Tax CPAs & accountants provide tax preparation, tax planning, business coaching,
    QuickBooks consulting, bookkeeping, payroll, offer in compromise debt relief, and business valuation services for small business.

    We serve: Tukwila, SeaTac, Renton. We have a few meeting locations. Call to meet John C. Huddleston, J.D., LL.M., CPA, Lance Hulbert, CPA, Grace Lee-Choi, CPA, Jennifer Zhou, CPA, or Jessica Chisholm, CPA. Member WSCPA.