Business Trip Vs. Personal Trip Expenses

Let’s imagine a hypothetical situation. You are a small business owner and there is a convention in Orlando, Florida where you could setup a booth for networking and sales. The conference is Monday through Wednesday. You decide to stay through the next Monday to go to Disney World. What and how much is deductible for tax purposes? That depends on the intent of the trip.

The IRS distinguishes, in Pub 463, between how to handle travel for business with personal aspects and travel for personal reasons with business aspects. If you are primarily going for business, travel expenses to your business location and back are deductible, as well your expenses relating to business. The Airfare, lodging, Ubers from the airport to your hotel or business location, parking at the convention center, booth fees, and other expenses in the same vein would be deductible. Meals are still at 50%, and with the new tax law, entertainment is not deductible at all regardless.

If you are traveling primarily for personal reasons, but you will be handling some business, what you are allowed to deduct is much narrower. The travel expenses to your location and lodging are no longer deductible. Anything that is not business related is no longer deductible. The booth fee and parking at the convention would be examples of expenses that are still deductible regardless of your intent for the trip.

Given that this topic does have a large grey area regarding intent, if you have questions about if your trip is business or personal, reach out to us at SBS CPA Group. We will do our best to clarify what is likely deductible or not.

Shane Lengerich
260-407-5000

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