It seems like only the rich, the self-employed, and tax accountants spend a lot of time considering taxes. And while being tax accountants isn’t necessarily in our future (personally), we wouldn’t mind being rich and self-employed. Perhaps you feel the same way.
If you’re self-employed, a solopreneur, or an entrepreneur on the move, keep reading. Business travel offers not only real business benefits, it can also offer tax savings (see how in our super simple example here).
To make the most of these deductions, you’ll need a travel diary. Think of it first, think of it often, and think of it as your travel companion to justify and document your business travel. Let’s dive into how your business travel diary can help you gain tax benefits while enjoying the perks of your business journeys.
By the way, Tripally has a travel diary built in to accompany your business travels. Join the Tripally waitlist here to get it first!
Treat your business travel diary as your roadmap for business travels. Start by jotting down the dates and destinations of your trips before you hit the road. These key details lay the foundation for potential deductions and serve as proof for the IRS.
Specify the primary reason for each business trip. Whether it was for a client meeting, industry conference, or any other business-related activity, a clear record of the trip's purpose is vital for justifying deductions.
If you’re looking for good opportunities to travel for business, Tripally can help you find them, too.
Your business travel diary is where you record the nitty-gritty details of spending, including hotel bills, airfare, rental car costs, and public transportation expenses. Depending on the type of expense, most if not all of your business travel expenses can be deducted from your taxable income. We recommend you keep it legal and check with a tax professional.
Reasonable expenses for meals and certain entertainment can also be viable deductions, but be sure to use your business travel diary for documentation. This is a very nuanced topic and IRS trouble is not fun for everyone, so be sure to maintain your records and confirm the legality of your deduction before filing your taxes. Also be sure to specify the names of clients or business associates you dined with and the intent of the meal.
Business expenses on the road are the same as business expenses where you work. From office supplies to postage, printing to shipping costs, your business travel diary is the repository for these costs that can transform into valuable deductions.
If you use your personal vehicle for business travels, tally the miles covered. The IRS has a standard mileage rate that can translate miles driven into deductions, all of which are best tracked in your trusty business travel diary.
For travel where your personal vehicle does the heavy lifting, your business travel diary logs expenses like fuel, maintenance, and repairs. These costs can be partially deducted based on the percentage of business use. Again, this is nuanced. Always check with a tax pro.
Occasionally, you might encounter business-related expenses that refuse to fit into predefined categories. In such cases, your business travel diary is there to welcome these miscellaneous expenses, ensuring that no potential deductions are left behind.
Weave in proof of your business undertakings during your journeys. Agendas, email exchanges with clients or partners, and notes from client meetings all provide a solid foundation to establish the purpose of your travels.
Feel free to use Tripally as evidence of your business travel intent. We do not assume any responsibility for how the IRS interprets your business travel; we only offer you opportunities to make more business connections in more places. Because in person is always better than digital.
The key to a successful business travel diary is rigorous record-keeping. Safeguard your receipts, invoices, and accompanying documents in an organized way that works for you. This ensures that you're well-prepared for tax season.
Stay well-versed with the latest tax regulations pertaining to business travel deductions. The IRS offers clear guidelines regarding what can and cannot be deducted. Compliance is your trusted partner in averting potential audits or penalties.
If the nuances of tax deductions for business travel fall outside your area of expertise, it's wise to consult a tax professional. We know we sound like broken records, but we want every self-employed person like you to get the benefits of business travel with the least risk. They can offer invaluable guidance to ensure that you're making the most of available deductions while keeping your travel diary in compliance with IRS regulations.
We believe in the power of face-to-face connections. Geography used to be a terrible limitation on business networking, meetings, mentorship, and more.
But not anymore. Tripally is your network for making more handshakes in more places and expand your business reach.
Join the waitlist and be the first to know when we launch!
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