Like business meals and the home office deduction, many freelancers, contractors, and the self-employed forget to claim business travel tax write-offs. You don’t have to fly first class and stay at a fancy hotel to claim travel expense tax deductions. Conferences, worksite visits, and even a change of scenery can (sometimes) qualify as business travel.
The IRS stipulates a few simple guidelines to determine whether a trip is for business.
For example, let’s say you’re a real estate agent living in Chicago. You travel to an industry conference in Las Vegas. You attend the conference during the day, go out in the evenings, and then stay the weekend. That’s a business trip! The flight, meals, hotel, and WiFi expenses are all tax write-offs!
Another example: you’re a freelancer on Upwork, living in Seattle. You move down to live with your sister in San Diego for the winter to expand your client network and work regular hours while you’re there. Flights, meals, sublet expenses, and shipping expenses are all tax deductible
With the rise of remote-first workplaces, many freelancers choose to take their work with them as they travel the globe. As long as you have some work-related reason for why the travel helps with your contracting or freelancing work, then this excursion counts as business travel. Plausible reasons include meeting with local clients or attending a local conference and then extending your stay.
However, if you’re a remote freelance software developer working from Thailand because you like the weather, that’s not business travel, sorry to say.
As a rule of thumb, all travel-related expenses while on a business trip are tax deductible. You can also claim meals while traveling, but be careful with entertainment expenses (like going out for drinks!). Here are some common types of write-offs you should use a business expense tracker to record.
Flights, train, and car rental expenses all count as tax write offs. Don’t forget the Uber ride from the airport and back!
Hotels, motels, airbnb stays, sublets on craigslist, or even reimbursing a friend for sleeping on their couch are all tax deductible lodging expenses.
While traveling for work, you can write off 50% of all food expenses (just like other business meals!) -- regardless of whether it qualifies as a business meal. Gabbing a burger alone at your airport terminal counts! Even groceries and takeout are tax deductible.
Airplane wifi, hotel wifi, and so on is completely deductible when you’re traveling for work. This also includes other communication expenses like hotspots and international calls.
If you need to ship things as part of your trip, such as conference booth materials or simply extra clothes, those expenses are also tax deductible.
If you have to look your best on the trip, related expenses are tax deductible. That necessity includes washing and cleaning charges.
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