Best Practices to Maximize Travel Deductions- Small Business

Summer Business Travel: What Expenses Are Tax Deductible?

If you’re a small business owner or self-employed professional planning summer business trips, understanding which travel expenses are tax deductible is essential. With current IRS rules and potential tax law changes, it’s more important than ever to stay informed and compliant.

Who Can Deduct Travel Expenses?

Under current law, self-employed individuals and business owners can still deduct qualifying travel expenses. However, due to the Tax Cuts and Jobs Act, employees cannot deduct unreimbursed business travel expenses on their personal returns through 2025.

A new proposal—“One Big, Beautiful Bill”—could permanently eliminate miscellaneous itemized deductions, including unreimbursed employee travel expenses. Keep an eye on evolving legislation, but for now, businesses and self-employed taxpayers still benefit.

What Travel Expenses Are Deductible?

The IRS allows deductions for ordinary and necessary business travel that requires an overnight stay within the U.S. Common deductible business travel expenses include:

Airfare, train, or bus tickets
Taxi, rideshare, or mileage for business driving
Hotel or lodging costs
Meals (limited to 50% of the expense)
Business-related dry cleaning
Phone calls and Wi-Fi charges
Laptop or equipment rentals

Important: No deductions are allowed for entertainment, sightseeing, movie tickets, or other personal costs—even if incurred during a business trip.

How Lavish is Too Lavish?

The IRS emphasizes that travel costs must be reasonable. That said, expensive meals at upscale restaurants aren’t automatically disqualified. Per IRS Publication 463:”Meal expenses won’t be disallowed merely because they are more than a fixed dollar amount or because the meals take place at deluxe restaurants, hotels, or resorts.”

Mixing Business and Pleasure: What’s Deductible?

Combining a business trip with some vacation time? Here’s how to break it down:

Only business days count: You can deduct meals and lodging for business days only.
Travel costs depend on trip purpose: If the primary purpose is business, the full cost of travel (e.g., airfare) is deductible.
If leisure is the main reason, none of the travel costs can be deducted.
The IRS may audit your time: Keep track of how much time you spend on business vs. personal activities to support your deductions.
Note: These rules are even stricter for international travel.

Special Situations to Know: Attending Conferences or Seminars

You must prove that the event is directly related to your trade or profession.

Keep:

Registration forms
Agendas
Receipts

Traveling with Your Spouse

Your spouse’s travel costs aren’t deductible unless they’re a legitimate employee and their presence serves a bona fide business purpose.

Best Practices to Maximize Travel Deductions

To ensure compliance with IRS travel rules and preserve your deductions:

Keep detailed receipts
Track dates, locations, and business purposes
Document attendees for meals

Final Thoughts
Summer is a busy season for business travel, but don’t let tax savings slip through the cracks. For help with travel expense deductions, tax planning, or business expense tracking, our accounting experts are here to help. Reach out today to maximize your deductions and stay audit-ready.