Which Travel Expenses Are Eligible for Deduction

Which Travel Expenses are Eligible for Tax Breaks

Similar to other costs of doing business, it is possible to claim income tax deductions for any travel expenses you personally incur so that you can provided services to your customers. And, it’s good practice to plan ahead for business trips so that you can maximize your deductions.

Costs that could be considered excessive will not be eligible for the deduction. You can only claim deductions for business travel expenses if they are ordinary and necessary. Here are a few commonly deductible travel expenses:

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

There isn’t a rigid or concrete rule on when travel expense is personal- or business-related. However, you can’t claim deductions for the expense of your day-to-day commute from your home and your office building. Instead, the commute is thought of as a personal expense.

You will have to travel a substantial distance in order to claim a deduction on your travel expenses. During a trip, you’ll have to depart from your main worksite, or tax home,. And, you’ll need to travel more than just a short distance from your workplace to meet a customer. This most often means you’ll have to leave the city in which your business is or, for smaller towns, its general greater area. Frequently, travel expenses are eligible when you’ve travelled far on long enough that you must spend the night.

You are able to deduct for business travel costs incurred while operating away from your tax home. However, if you do provide services at a client’s location for an indefinite period of time or for over a year, you cannot claim the deduction.Maintaining exact records is important. Establish this practice to ensure easier tax prep, and confirm the any deductions you claim on your tax return.

More info on travel expenses and deductions are at www.irs.gov (Travel, Entertainment, Gift and Car Expenses).