There are different travel deduction rules when traveling outside the US. Yes! Did you know that? For those of you who want to take advantage of all these deductions, I highly recommend you take my 8 hour That’s deductible program. I will make sure that you leave with all these details and you are guaranteed to find thousands of dollars in additional business tax deductions.
So, what does the IRS say about travel outside of the US – well, the all or nothing rule does NOT apply when business travel is outside of the US. The deductible amount of a round trip travel expense is pro-rated by the number of days on business to the total number of days of travel. Transportation days, days spent on business and weekends and certain holidays all count as business days for this purpose. Time to pack for Paris! Seriously, can you see how using available tax deductions may allow for a European vacation to be more cost effective that a trip to Hawaii?
However, if the trip is primarily for personal reasons, then the only deductible expenses will be the direct costs such as seminar registration fees. AND, cruise ship convention expenses are limited to a $2,000 deduction per year.
Note that travel as a form of education generally is not deductible. Some clients like to consider this “research” but be careful here. Under IRC27(m)(2), this may be too grey an area to play in.
Now travel for investment purposes including meals are deductible. Income producing property travel? Yes!
So as you are deciding on what to do this summer, discuss with your tax accountant before you commit to an expensive non deductible vacation.
PS: Our May 19th That’s deductible Program is SOLD OUT but our next session will be June 9th and 10th, plenty of time to adjust your June 15th Estimated Tax Payments. Sign up at http://wendybarlin.com