How and What to Deduct During Business Travel

 

As I sit in the airport on my way to Round 9 of the amazing Creative at Heart Conference, I thought it would be fun to chat about how to expense all the things that go along with attending a conference.

Can I deduct clothing for a conference?

As I was in the Anthropologie dressing room looking at the price tags of all the pretty things I found, I was REALLY wishing the IRS allowed us to deduct clothing we plan to wear at conferences (that we attend or speak at). Unfortunately, they’re pretty straightforward in the IRS Publication 529 (search “clothing”) that any business clothing purchased that can also be worn outside of work functions are not deductible.

Flight and Luggage Fees

This is pretty straightforward – any expenses related to your flight, including luggage fees, can be expensed through your business. If you’re driving to the event, check out this post on car and truck expenses.

Taxis, Ubers, Lyfts

Whichever one you choose, this travel cost between the airport and your hotel is deductible. If you’re sharing a ride with another attendee, Uber and Lyft allow you to split the fare so you each get a receipt for the expense!

Meals During Travel

If you’re traveling away from your “tax home” (city or area where your main place of business is located), you can deduct all meals eaten while away, not just meals where you talk business. If you don’t want to keep track of all the receipts while you’re gone, you have the option of using a per diem rate (a flat rate based on the city you’re in). You can use this link to find the per diem rate for the location of your travels. The Bermuda Run, NC meals and incidentals rate is $94/day.

It’s important to note that the Tax Cuts and Jobs Act of 2017 have made significant changes to the deductibility of business meals and entertainment starting in 2018. As of 2018, entertainment expenses are nondeductible and most meals are 50% deductible. Prior to the Tax Cuts and Jobs Act, entertainment expenses were 50% deductible.

Tips

Any tips you pay related to deductible meals, lodging, or travel can also be expensed. If they are paid in cash, keep a log that shows the date, amount of tip, and reason (ex: server tip at dinner).

Dry Cleaning and Laundry

If you’re gone for an extended period of time and need laundry done while traveling, these expenses can be deducted.

Record-keeping While Traveling

Keep receipts of all your expenses OR take pictures of the receipts and upload them to a Dropbox folder or your bookkeeping software. In the Quickbooks app, you can upload receipt images directly to expenses on your phone! FreshBooks, Xero and Wave also have this capability. I like to keep paper copies as well, just in case, so I usually bring along a zippered pouch or wallet (like this one) to stash receipts in.

What Else Can I Deduct?

As a small business accountant, the question I probably get more than any other is, “Can I deduct this?” And it makes sense—small business owners work hard for their money and want to save every penny they can from getting taxed. This is why I created The Ultimate Guide to Tax Deductions for Small Business Owners, a free resource to help you save money on taxes!

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Amy Northard, CPA

The Accountant for Creatives
+ taxes + bookkeeping + consulting
+ Hang out with me over on Instagram!

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