If you’re a business owner, you can deduct travel expenses you paid for yourself and your employees. Travel expenses must be for temporary travel away from your main place of business.
Temporary travel can be anything from one day to less than a year. In fact, it doesn’t even have to last an entire day, as long as the trip requires sleep or rest due to the demands of the work performed away from home.
“Home” is defined by the IRS as your “Tax Home” or in other words, your main place of business. If you have an office, that is your tax home. For those who work from home, your home office qualifies as your tax home. The three most important factors to consider in determining your tax home are:
1. Where you spend the most time while conducting work.
2. Where you get the most work done.
3. Where the most significant amount of income is produced.
If you operate from multiple locations these three factors will help you decide where your tax home is.
The IRS does not consider business travel going from where you live to your tax home. That is considered commuting. Cost of meals while at your tax home are also non-deductible.
Business travel expenses must be ordinary and necessary. The IRS cautions against deducting “lavish” expenses or any costs arising from personal use.
Deductible business travel expenses include: transportation (even if you used your own car) you have to take from your tax home to your business destination; meals and lodging; dry cleaning and laundry; any fares you had to pay to get from the airport to your hotel and from your hotel to your business destination. For a full list refer to Publication 463 by the IRS.
As with any deduction, burden of proof belongs to the taxpayer and records must be kept of all expenses paid for.
the Confident Taxpayer 