A lot of people will tell you that there is nothing better in this world than being your own boss. Apart from the obvious reasons, did you know that traveling is also included in the package. Vacation is the best thing you can do for your body in order to relax, but as we often see, money can be an issue. Still, America is not known as the land of opportunity for nothing, and with a bit of research, you can turn this into your advantage.
How is that possible? Two words: tax deductions. Of course, just mentioning these two words won’t make the problem go away, and that’s why we wrote this article, giving you the best tips to maximize your potential. Be sure to read it till the end.
Transportation doesn’t have to be expensive
There are a couple of things that you need to watch out for, if you want to have your transportation fees tax deductible. First of all, you need to decide where you want to go. You are far more likely to get a fully deductible transport within the U.S. than you are when it comes to international travel. When you travel internationally, your trip needs to be at least 75% business orientated in order to get a full deduction. It is something to keep in mind if you plan to go on a vacation across the ocean.
Overstay is not forbidden, but be careful
We get it, you work hard, and you also want to play hard in your free time, but that can lead to exhaustion. When that happens, most people are faced with a difficult decision. Do they go home tired, or will they be willing to risk being disqualified for deductions. Fortunately, things aren’t so gloomy as they might seem at first. If you want to give yourself a little extra slack, you can. The only thing you need to pay attention to is to save your business documentation at all times, and not to deduct any non-business related expenses. If you follow those simple rules it will be smooth sailing.
The same rules don’t apply to cruises
Going on a cruise after a stressful year can be a life saver, but if you want to aim at tax deduction, there a few things worth mentioning here. First of all, the limit for tax deduction is set at $2000 per year. It doesn’t matter how often you travel, this will always be the bottom line. Furthermore, if your plan is to apply for a tax deduction here, be sure to have detailed written statement of your intensions. Finally, be noted that only U.S. registered ships that avoid foreign ports fall into this category. There are quite a few things to keep in mind here, but it can be worthwhile.
Be careful about the family expenses
The simple rule is, you cannot incorporate your family's expenses if they aren’t involved in your business. That is perfectly understandable, but there are a few ways in which you can go around this. For example, if you want to go on a road trip, the car rental fee can be deducted, and you can bring your family along. The same goes for the hotel rooms. Still, be warned. If you choose a bigger room, those expenses are highly unlikely to be covered. You can’t have it all, but there are some things here and there that can go a long way.
Other expenses worth mentioning
If you like to go on vacations, you know just how fast those costs can add up. A taxi ride here and there, phone calls and even Internet access can drain your pockets in a hurry. Don’t worry though, there is some good news here. If you can make any of these expenses, business-related, they are all deductible. Furthermore, there are also some things that are partially deductible, such as business-related meals, that return 50 cents on the dollar. That seems like a fine deal to me. At the end, the only advice we can give you is to be reasonable. Expenses should always remain reasonable due to your circumstances. With that covered, you are all prepared, and ready to go. Have a nice trip!