Conferences, worksite visits, and other travel may be claimed as a travel deduction. The
Internal Revenue Service allows “ordinary and necessary” expenses regarding travel. They also take into account how far you travel from your tax home.
But what is a tax home, and what is meant by ordinary expenses? Here are the facts about traveling for business.
Tax Home Is the Base
You need to establish your tax home before you start deducting business travel. The IRS considers the tax home the entire city or general area where your business is located. This may not be where you live. For example, if your business is in Cleveland, Ohio, but you live in Savannah, Georgia, you cannot deduct the traveling expenses in Cleveland, because that’s your tax home. And your travel back to Savannah isn’t for work, so you can’t deduct that either.Ordinary and Necessary Travel Expenses
Although “ordinary” and “necessary” is slightly vague, there are some ways to gauge what is acceptable. For starters, choose your hotel carefully. Think of where you would usually stay if you were on vacation. In other words, if you usually wouldn’t stay at a five-star hotel for personal, don’t suddenly stay at one for business. It’s a red flag.
