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Travel and Meal Expenses: What’s Deductible?

Gelman, Rosenberg & Freedman CPAs is a member of CPAmerica International, an association of CPA and consulting firms that provides industry knowledge including insightful articles, to help member firms serve clients and other individuals and organizations.

If you travel frequently as part of your job, it’s essential at tax time to know what’s deductible and what isn’t, especially if you aren’t reimbursed – or aren’t reimbursed fully – by your employer. 

woman paying billFor business travel to conduct business or attend meetings or conventions within the United States, the following are 100 percent deductible:

  • Hotel expenses
  • Transportation expenses
  • Cleaning and laundry
  • Cost of meeting rooms
  • Registration fees
  • Tips (other than for meals or entertainment)

Other expenses are only 50 percent deductible. They include:

  • Meals and entertainment
  • Tips for meals and entertainment

Transportation workers may deduct 80 percent for meals and entertainment, subject to Department of Transportation hours-of-service limitations.

Lavish or extravagant expenses are not deductible at all.

If you attend a conference or meeting aboard a cruise ship, you may deduct up to $2,000 per employee per year if the ship is registered in the United States and all ports of call are in the United States or its possessions.

Luxury water travel that costs in excess of twice the federal per diem rate is not deductible

Jackie’s leadership allowed me to stay focused when faced with an audit a month after returning from extended leave. She stays in contact with me throughout the year and responds immediately to any questions ... I am always impressed by the quick turnaround time. Our audit always goes smoothly.

Feng Zhang |  Finance Manager
The Arc of the United States