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This is the second part of the segment I am writing about business expenses on your tax returns, I am going to talk about travel expenses.  Travel Expenses are defined by the IRS code as transportation expenses and meals and lodging while away from home in the pursuit of a trade or business. Now this away from home must be overnight for this to count.  A day trip for work would not count as travel expenses.  Now when a temporary assignment comes up as some people might experience, those expenses incurred while traveling will be deductible.  If you question how long a temporary assignment is, you are probably not alone.  It is anything that is 12 months or less, so the majority of assignments away from your tax home will count as temporary at least for tax ramifications.

There are some restrictions to travel expenses that you may come across.  If you are traveling to a convention, it must be directly related to your trade or business.  Travel as a form of education is not deductible, however, if the education qualifies as a deduction then travel is allowed.  I will discuss education expenses later in this five part segment. When many people go on a business trip they also include some personal time in with it.  There are certain rules you need to follow if you want to deduct any of the costs associated with this type of travel.

First, if you are traveling domestically the trip must be primarily for business in order for the expenses to be deductible.  If you are traveling outside of the United States some special rules apply. First your transportation expense must be allocated between business and personal days if you are a) away from home for seven days or less or b) less than 25 percent of the time was for personal purposes.   No allocation is required if you did not have control over planning the arrangements or if the trip was primarily for pleasure no deduction is allowed.  A good thing to know is that travel days count as business days and weekends, legal holidays, and intervening days are considered business days provided that both the preceding and succeeding days were business days.

With this information you should now know what you need to know if order to get your correct amount of travel expenses deducted from you next tax return. But as always check the instructions since the IRS rules and requirements can be updated.