A Few Things You Need to Know About How Taxes Affect Traveling for Business

No matter what your personal financial situation, it’s a good idea to visit with a team of advisors when it’s tax time. They can ensure you’re getting every tax deduction that’s possible for your particular situation.

Especially since one area of tax law can be kind of tricky—travel. Especially if you travel for business.

Here are a few things you need to know about what you can deduct from your taxes, and what you can’t, before you book your next flight.

Air Travel Can Be Deducted in Many Cases

Next to the hotel, the cost of your plane tickets is likely to be the biggest expense in regards to your trip. Fortunately, air travel in most cases can be deducted from your taxes.

It doesn’t matter why you’re traveling, if your company asks you to hop on a plane, those expenses can be deducted. That is, unless you use frequent flyer miles.

If you’re using points to travel, you cannot deduct the cost from your taxes, since you didn’t technically pay for the flight.

Portions of Some Trips May Not Be Deducted

There are many things about your trip that can be deducted from your taxes, but that doesn’t mean your entire trip from start to finish can be deducted. There are plenty of things that cannot be deducted. They include:

  • You cannot take deductions for your tax home, which is the area where your main place of work is located, even if it’s in a different place from your family home.
  • Only the business portion of your trip can be deducted. Any personal things you do while away cannot be deducted.
  • Room expenses are deductible, but personal charges, like fitness center fees, are not deductible.

Meal Costs Are Not Fully Deductible

One of the biggest mistakes new business travelers make is thinking that all of their meals are tax deductible. The truth is, only half of your meal costs are deductible.

That’s an important thing to consider on your next trip because it may change what you choose from the menu. You may opt for a sandwich instead of the steak dinner if you know Uncle Sam will only be paying half.

Bringing Your Family Probably Isn’t Deductible

Frequent traveling can be hard on your family. That’s why it’s so tempting to bring along a spouse or children when you take off on your next business trip.

Just be careful if you decide to bring loved ones along. Mixing business with personal travel is complicated. Your trip can only be deducted if you spend the overwhelming majority of your time on business-related duties, and anything that has to do with your spouse our children cannot be deducted.

Taxes are always tricky, but they can get even trickier if you travel for business. Hire a professional to help you understand the details on this list and you can make sure you fill out your tax return properly while saving as much money as you can at the same time.