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Business Travel

We often get questions regarding the tax deduction of personal days that are part of a business trip. In order to deduct all travel expenses, you must spend 50% of days on business for domestic trips and 75% or more for foreign trips. For a day to count as a business day, you must work at least four hours. If you work Friday and Monday, you can count the weekend as business days even if you do no work. Travel days to and from the destination count as business days.

You can only deduct hotels for the days that are considered business. Meals can be deducted at 50% for business days. For the travel expenses of a spouse or child to be deductible, he/she must also be an employee of the business or there must be a bona fide business purpose they are traveling with you.

Side trips are not deductible (i.e.: if you go to a personal destination en route to or returning from your business destination those expenses are not deductible). Likewise, if the primary purpose of your trip is personal, but you spend some time on business, you can only deduct the expenses directly related to the business (your travel to and from home would not be deductible).

Proper documentation of the time spent working and related business expenses is important to support the deductions should the IRS audit your return. See IRS publication 463 for more details.

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