What You Need To Know About Business Travel Expenses

A work trip can be costly. From flights and hotels to meals and taxi service, managing your business travel expenses is key to staying on budget and making the most of available tax deductions. Knowing which costs to claim and how to deduct them can reduce stress and help you maximize your reimbursement.

Read on to discover what qualifies as a business travel expense, which costs are tax-deductible, and how to write them off correctly. 

What Are Business Travel Expenses?

According to the IRS, travel expenses are the necessary expenses of traveling for your business, profession, or job — in other words, the out-of-pocket costs you incur during a business trip. This includes airfare, hotel rooms, and ground transportation, as well as incidental expenses like Wi-Fi and baggage fees. 

If the cost supports your work while traveling, it’s likely a business expense, but all expenses must still serve a clear business purpose, like meeting with clients or visiting a company location. When it comes to seeking reimbursement and claiming tax deductions for business travel, solid expense tracking is essential.

Which Travel Expenses Are Tax Deductible?

Many travel expenses are tax deductible for self-employed workers, company employees, and business owners as long as they’re primarily work-related. Here are the most common types of travel expenses that qualify for tax deductions:

• Direct travel: The cost of traveling to and from the destination is typically tax deductible. Examples of direct travel deductions include airfare, mileage on your personal vehicle, and train tickets. Keep in mind that these expenses must be essential for your work to qualify for deduction — personal travel costs for sightseeing or entertainment are not eligible.
• Ground transportation: Local transport at your destination — such as taxis, rideshares, rental cars, and public transit — is generally deductible. You can also deduct related costs like tolls and parking fees. Ground transportation might involve going from the airport to your hotel or to and from client meetings. If the transportation is tied to business activities, it usually counts as a write-off. To claim these deductions, you need to hang onto your receipts and log the purpose of each trip.
• Lodging: Overnight stays in accommodations such as hotels and motels are deductible when required for business. The lodging must be reasonable and located near your business activity — extravagant stays may only be partially deductible (or not at all). Save hotel confirmations or itemized bills for accurate expense tracking.
• Meals: Business trip meals are partially deductible, generally up to 50% of the cost. This includes meals you buy en route, dining alone, and eating with clients and colleagues. As with accommodation, lavish or excessive meals aren’t considered essential expenses. To stay compliant, keep your itemized receipts and note who you dined with, if applicable.
• Communication: Staying connected during business travel often results in extra costs. Services like Wi-Fi, international phone plans, and business-related calls are all potentially deductible. The expenses must be necessary for conducting work, such as talking to clients and fellow employees. Be sure to separate business communication from personal use on your records.
• Equipment rentals: If you need equipment for a meeting or presentation, those costs may be tax deductible. This might be a laptop, projector, or temporary workspace. Equipment rentals only qualify as tax deductions when you’re using them for business purposes. Again, remember to save your receipts and rental agreements.
• Laundry and dry cleaning: When your business trip lasts several days or more, keeping your clothing clean and presentable often qualifies as a travel expense. Laundry, dry cleaning, and pressing services are deductible because they’re considered reasonable expenses for a professional appearance.

How to Write Off Business Travel Expenses

When it comes to tax-return season, logging all your expenses can be challenging. To help you navigate the process, here’s a five-step guide to writing off business travel expenses correctly.

1. Confirm Eligibility 

Your trip must be work-related to claim any tax deductions — think conducting onsite research or attending a company event. In addition, the travel should take you away from your regular workplace and will typically involve an overnight stay. All expenses must be reasonable, necessary, and directly connected to your work. Vacation portions of the trip are not eligible for deductions, so separate any personal travel expenses.

2. Save all receipts 

Saving receipts is crucial because they prove your spending and validate your deductions if tax authorities ever audit you. Receipts provide detailed information about the date, amount, and nature of each expense, making it easier to track your costs. Without this documentation, you risk losing valuable deductions or facing penalties for incomplete records.

3. Organize Your Expenses

Categorizing your travel expenses makes the write-off process more efficient. When you sort costs like meals, hotels, and incidentals, it’s easy to spot deductible items and ensure you don’t miss anything. Separating different types of expenses also helps you comply with IRS guidelines. Accounting apps and expense management software can take a lot of the organizing off your plate.

4. Calculate Expenses Correctly

Accurate calculations mean you claim the right amount on your tax return, avoiding underpaying or overpaying. Mistakes on your tax forms can lead to audits and penalties. Being precise about your calculations also helps you optimize deductions and stay compliant with the laws for each type of expense.

5. File Your Write-off With the IRS

Finally, report your business travel expenses using the proper forms — like Schedule C if you're self-employed or your company’s expense report if you're on payroll. If using accounting software, double-check your entries for accuracy. When in doubt, consult a tax professional to ensure you’re filing write-offs correctly and not missing out on potential savings.

How Can an Athena Assistant Help You Manage Your Travel Expenses?

Managing and writing off business travel expenses is a breeze when you have qualified support. With an Athena Assistant, busy leaders can delegate time-consuming tasks like handling receipts and organizing records for tax season.

Your dedicated assistant can manage mileage logs, categorize charges, and flag potential deductions in real-time. By taking care of the day-to-day details, an Athena Assistant helps you stay audit-ready year-round. That way, you’re not scrambling to find documents when tax time arrives, and you don’t leave any money on the table.

Get Started With an Athena Assistant

Whether planning your business travel or making sense of your expenses, an Athena Assistant helps you stay on top of your admin without the stress — their world-class ongoing training ensures your tax returns remain compliant. 

Our assistants undergo a rigorous selection process before being matched with a high-performing leader. They provide expert support with a wide range of tasks, letting you focus on strategic work that moves your business forward.

To streamline your next trip, get started with an Athena Assistant today.