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From client lunches to rental cars, business travel expenses run the gamut. Knowing which ones you can claim as deductions on your business tax return can help you remain compliant. The following guide highlights when you’re eligible to submit business travel expenses, what documents are necessary, and how to include them on your return.

When Can You Claim Business Travel Expenses?

The IRS defines business travel as commuting away from your primary tax home to conduct business affairs. Your tax home can be your actual house or an office building. To claim any eligible business travel expenses, you are required to have a physical location and prove you’re traveling for specific business purposes. 

What Qualifies as Business Travel Expenses?

business tax returnTo claim a business travel expense on your business tax return, you must prove that the out-of-pocket cost involved a company matter. Some of the most common expenses include airline tickets, hotel stays, and half of your meal costs.

The IRS also considers checked baggage fees, bus and ride-sharing fares, as well as parking fees and tolls as eligible business expenses. In general, personal expenses can not be claimed as business expenses—such as if you’re traveling on vacation or on another personal excursion. The IRS says that business expenses must be “necessary and reasonable” to be considered for a deduction. 

What Proof Do You Need?

Keep all receipts in case the IRS needs to verify your travel expenses. While you should hold on to paper documents, consider scanning them as PDFs as a backup. Before preparing you business tax return, organize your receipts by travel reason, travel dates, the dollar amount of the expenses and the reason the expenses were incurred.

How Do You Claim the Deductions?

Whether you’re completing an individual or business tax return, there are sections that will ask whether you own some form of business. If the answer is yes, you will be asked a series of questions about travel expenses. Be prepared to provide specific details. If you’re uncertain or apprehensive about what to include, a tax return preparation can offer guidance. 

 

If business travel is a common experience for you, the office of Joe Heard, CPA wants to help ensure you’re claiming all eligible deductions. Based in Checotah, OK, the agency specializes in providing expert business tax return services for companies of all sizes and from a wide range of industries. You can count on working with a team that is up to speed on the latest IRS business rules and is committed to completing accurate and on-time returns. To learn more, call (918) 473-1492 and visit the website for extensive information on the firm’s available services. 

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