Business Deductions
- Amortization
- Business Losses and Net Operating Losses
- Car and Truck Expenses
- Day-Care Services
- Depreciating Business Property
- Depreciating Your Car
- Domestic Production Activities Deduction
- Health Insurance Deduction
- Home Office Deduction
- Meal and Entertainment Expenses
- Organizational Costs and Start-up Costs
- Qualified Plan Awards
- Schedule C Expenses
- Section 197 Intangibles
- Should You Sell or Trade in Your Car?
- Start-up Costs
- Travel Expenses
More Tax Topics
- Business Structures
- Hiring Workers
- Retirement
- Top Tax Myths
- Per Diem Rates - IRS Publication 1542 Oct 2011 for Travel Within the Continental U.S (for employers who pay a per diem allowance to employees)
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Need Some Deductions for 2011?
Don't overlook these!
Updated for 2011
Travel Expenses
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Tax Terms You Need to Know-Continued
3) Transient (itinerant):
If you have no permanent residence and move from city to city to work, your tax home is wherever you are working at the time; you are considered an itinerant. This would apply to someone who travels around in a motor home or trailer for example, and lives in it while in the work area.
4) Away From Home Test:
To be away from home:
- You must be away from the general area of your tax home substantially longer than a regular day's work, and
- require sufficient time off to get necessary sleep before returning home.
- Taking a one-hour nap in the car is not sufficient time off.
- You don't necessarily have to be away from home 24 hours, you just have to have enough time off to get necessary rest to function properly.
Overnight sleep rule: This rule, which requires that you get sufficient time off to get the property rest before returning home, prevents you from being able to deduct the cost of your meals on one-day business trips.
Example:
Sufficient time off to rest:
- You own your truck.
- You use your truck to deliver produce throughout the state.
- You make a run between two cities.
- You leave your home base terminal at 2 a.m. and return to it at 6 p.m. (16 hours).
- Before returning, you take 4 hours off at your turnaround point.
- You eat and rent a hotel room to sleep before returning.
You meet the away from home test. Your transportation and lodging expenses are 100% deductible. However, only 50% of your meal costs are deductible.
Example:
Not sufficient time off to rest:
- Same facts as above, except you only take one hour off to eat and rest in your truck before returning.
You do not meet the rest test since there was insufficient time to get the proper rest. You are not considered away from home. Your trip is a one-day business trip which means your meal expenses are not deductible.
Next:
Travel Expenses: Personal Expenses; Expenses of a Spouse, Dependent, or Other Individual
Related Links
- Domestic Per Diem Rates
- What Are Travel Expenses?
- Who May Deduct Travel Expenses?
- Items Included in Travel Expenses
- Tax Terms You Need to Know (Tax Home Defined)
- Tax Terms You Need to Know (Tax Home Example)
- Entertainment Expenses of Non-Employees
- Entertainment Expenses of Non-Employees-Example
- Employee Travel Expenses
- Employer Error Reporting Travel Expense Reimbursement on Form W-2
- Employee Accountable Plan
- Commuting Costs
- When You May Deduct Commuting Costs
- Temporary Work Locations and Commuting Expenses
- Temporary Work Location-Example
- What if Your Expectations for the Length of Time to Work Changes?
- Professionals Traveling to Clients' Sites
- Business Conventions and Seminars
- Investment Conventions
- Video Tapes Received at a Business Discussion
- IRS Meal Allowance
- If Employer is a Relative
- Daily Meal Allowance Amount
- Travel Expense Records You Must Keep
- Transportation Industry Workers
- Claiming the IRS Meal Allowance
- Travel By Cruise Ship
- Business-Vacation Trips Inside the U.S.
- Business-Vacation Trips Outside the U.S.
Copyright © 2008-2012 Larry Villano. All rights reserved.