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Free 2011 Tax Software

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Free 2011 Tax Software

Free 2011 tax software Index A Assistance (see Tax help) B Base amount, Base amount. Free 2011 tax software C Canadian social security benefits, Canadian or German social security benefits paid to U. Free 2011 tax software S. Free 2011 tax software residents. Free 2011 tax software Children's benefits, Children's benefits. Free 2011 tax software Comments on publication, Comments and suggestions. Free 2011 tax software D Deductions related to benefits, Deductions Related to Your Benefits $3,000 or less, Deduction $3,000 or less. Free 2011 tax software $3,000. Free 2011 tax software 01 or more, Deduction more than $3,000. Free 2011 tax software Disability benefits repaid, Disability payments. Free 2011 tax software E Estimated tax, Tax withholding and estimated tax. Free 2011 tax software F Form 1040, Reporting on Form 1040. Free 2011 tax software Form 1040A, Reporting on Form 1040A. Free 2011 tax software Form RRB-1042S, Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) Form RRB-1099, Lump-sum payment reported on Form SSA-1099 or RRB-1099. Free 2011 tax software , Form RRB-1099, Payments by the Railroad Retirement Board 2013 Form SSA-1042S, Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Form SSA-1099, Lump-sum payment reported on Form SSA-1099 or RRB-1099. Free 2011 tax software , Appendix Form W-4V, Tax withholding and estimated tax. Free 2011 tax software Free tax services, Free help with your tax return. Free 2011 tax software Future developments Product page, Reminders G German social security benefits, Canadian or German social security benefits paid to U. Free 2011 tax software S. Free 2011 tax software residents. Free 2011 tax software H Help (see Tax help) J Joint returns, Joint return. Free 2011 tax software L Legal expenses, Legal expenses. Free 2011 tax software Lump-sum election, Lump-Sum Election Example, Example M Missing children, photographs of, Reminders N Nonresident aliens, Nonresident aliens. Free 2011 tax software Form RRB-1042S, Form RRB-1042S, Payments by the Railroad Retirement Board 2013 (Nonresident Aliens) Form SSA-1042S, Form SSA-1042S, Social Security Benefit Statement 2013 (Nonresident Aliens) Nontaxable benefits, Benefits not taxable. Free 2011 tax software P Permanent resident aliens, Lawful permanent residents. Free 2011 tax software Publications (see Tax help) R Railroad retirement benefits, Introduction Repayments Benefits received in earlier year, Repayment of benefits. Free 2011 tax software , Repayment of benefits received in an earlier year. Free 2011 tax software Disability benefits, Disability payments. Free 2011 tax software Gross benefits, Repayment of benefits. Free 2011 tax software , Repayments More Than Gross Benefits Reporting requirements, How To Report Your Benefits Lump-sum payment, Lump-sum payment reported on Form SSA-1099 or RRB-1099. Free 2011 tax software S Social Security benefits, Introduction Suggestions for publication, Comments and suggestions. Free 2011 tax software T Tax help, How To Get Tax Help Taxable benefits Determination of, Are Any of Your Benefits Taxable?, How Much Is Taxable? Maximum taxable part, Maximum taxable part. Free 2011 tax software Person receiving benefits determines, Who is taxed. Free 2011 tax software Worksheets, Worksheet A. Free 2011 tax software Examples, Examples, Worksheets Which to use, Which worksheet to use. Free 2011 tax software Total income, figuring, Figuring total income. Free 2011 tax software TTY/TDD information, How To Get Tax Help U U. Free 2011 tax software S. Free 2011 tax software citizens residing abroad, U. Free 2011 tax software S. Free 2011 tax software citizens residing abroad. Free 2011 tax software U. Free 2011 tax software S. Free 2011 tax software residents Canadian or German social security benefits paid to, Canadian or German social security benefits paid to U. Free 2011 tax software S. Free 2011 tax software residents. Free 2011 tax software W Withholding, Tax withholding and estimated tax. Free 2011 tax software Exemption from, Exemption from withholding. Free 2011 tax software Form W-4V, Tax withholding and estimated tax. Free 2011 tax software Voluntary, Tax withholding and estimated tax. Free 2011 tax software Worksheets Taxable benefits Blank Worksheet 1, Worksheets Filled-in Worksheet 1, Filled-in Worksheet 1. Free 2011 tax software Figuring Your Taxable Benefits, Filled-in Worksheet 1. Free 2011 tax software Figuring Your Taxable Benefits, Filled-in Worksheet 1. Free 2011 tax software Figuring Your Taxable Benefits, Filled-in Worksheet 1. Free 2011 tax software Figuring Your Taxable Benefits Quick calculation, sample, Worksheet A. Free 2011 tax software Prev  Up     Home   More Online Publications
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The Free 2011 Tax Software

Free 2011 tax software 1. Free 2011 tax software   Travel Table of Contents Traveling Away From HomeTax Home Tax Home Different From Family Home Temporary Assignment or Job What Travel Expenses Are Deductible?Employee. Free 2011 tax software Business associate. Free 2011 tax software Bona fide business purpose. Free 2011 tax software Meals Travel in the United States Travel Outside the United States Luxury Water Travel Conventions If you temporarily travel away from your tax home, you can use this chapter to determine if you have deductible travel expenses. Free 2011 tax software This chapter discusses: Traveling away from home, Temporary assignment or job, and What travel expenses are deductible. Free 2011 tax software It also discusses the standard meal allowance, rules for travel inside and outside the United States, luxury water travel, and deductible convention expenses. Free 2011 tax software Travel expenses defined. Free 2011 tax software   For tax purposes, travel expenses are the ordinary and necessary expenses of traveling away from home for your business, profession, or job. Free 2011 tax software   An ordinary expense is one that is common and accepted in your trade or business. Free 2011 tax software A necessary expense is one that is helpful and appropriate for your business. Free 2011 tax software An expense does not have to be required to be considered necessary. Free 2011 tax software   You will find examples of deductible travel expenses in Table 1-1 , later. Free 2011 tax software Traveling Away From Home You are traveling away from home if: Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work, and You need to sleep or rest to meet the demands of your work while away from home. Free 2011 tax software This rest requirement is not satisfied by merely napping in your car. Free 2011 tax software You do not have to be away from your tax home for a whole day or from dusk to dawn as long as your relief from duty is long enough to get necessary sleep or rest. Free 2011 tax software Example 1. Free 2011 tax software You are a railroad conductor. Free 2011 tax software You leave your home terminal on a regularly scheduled round-trip run between two cities and return home 16 hours later. Free 2011 tax software During the run, you have 6 hours off at your turnaround point where you eat two meals and rent a hotel room to get necessary sleep before starting the return trip. Free 2011 tax software You are considered to be away from home. Free 2011 tax software Example 2. Free 2011 tax software You are a truck driver. Free 2011 tax software You leave your terminal and return to it later the same day. Free 2011 tax software You get an hour off at your turnaround point to eat. Free 2011 tax software Because you are not off to get necessary sleep and the brief time off is not an adequate rest period, you are not traveling away from home. Free 2011 tax software Members of the Armed Forces. Free 2011 tax software   If you are a member of the U. Free 2011 tax software S. Free 2011 tax software Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. Free 2011 tax software You cannot deduct your expenses for meals and lodging. Free 2011 tax software You cannot deduct these expenses even if you have to maintain a home in the United States for your family members who are not allowed to accompany you overseas. Free 2011 tax software If you are transferred from one permanent duty station to another, you may have deductible moving expenses, which are explained in Publication 521, Moving Expenses. Free 2011 tax software   A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a tax home (explained next) aboard the ship for travel expense purposes. Free 2011 tax software Tax Home To determine whether you are traveling away from home, you must first determine the location of your tax home. Free 2011 tax software Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. Free 2011 tax software It includes the entire city or general area in which your business or work is located. Free 2011 tax software If you have more than one regular place of business, your tax home is your main place of business. Free 2011 tax software See Main place of business or work , later. Free 2011 tax software If you do not have a regular or a main place of business because of the nature of your work, then your tax home may be the place where you regularly live. Free 2011 tax software See No main place of business or work , later. Free 2011 tax software If you do not have a regular or main place of business or post of duty and there is no place where you regularly live, you are considered an itinerant (a transient) and your tax home is wherever you work. Free 2011 tax software As an itinerant, you cannot claim a travel expense deduction because you are never considered to be traveling away from home. Free 2011 tax software Main place of business or work. Free 2011 tax software   If you have more than one place of work, consider the following when determining which one is your main place of business or work. Free 2011 tax software The total time you ordinarily spend in each place. Free 2011 tax software The level of your business activity in each place. Free 2011 tax software Whether your income from each place is significant or insignificant. Free 2011 tax software Example. Free 2011 tax software You live in Cincinnati where you have a seasonal job for 8 months each year and earn $40,000. Free 2011 tax software You work the other 4 months in Miami, also at a seasonal job, and earn $15,000. Free 2011 tax software Cincinnati is your main place of work because you spend most of your time there and earn most of your income there. Free 2011 tax software No main place of business or work. Free 2011 tax software   You may have a tax home even if you do not have a regular or main place of work. Free 2011 tax software Your tax home may be the home where you regularly live. Free 2011 tax software Factors used to determine tax home. Free 2011 tax software   If you do not have a regular or main place of business or work, use the following three factors to determine where your tax home is. Free 2011 tax software You perform part of your business in the area of your main home and use that home for lodging while doing business in the area. Free 2011 tax software You have living expenses at your main home that you duplicate because your business requires you to be away from that home. Free 2011 tax software You have not abandoned the area in which both your historical place of lodging and your claimed main home are located; you have a member or members of your family living at your main home; or you often use that home for lodging. Free 2011 tax software   If you satisfy all three factors, your tax home is the home where you regularly live. Free 2011 tax software If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. Free 2011 tax software If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses. Free 2011 tax software Example 1. Free 2011 tax software You are single and live in Boston in an apartment you rent. Free 2011 tax software You have worked for your employer in Boston for a number of years. Free 2011 tax software Your employer enrolls you in a 12-month executive training program. Free 2011 tax software You do not expect to return to work in Boston after you complete your training. Free 2011 tax software During your training, you do not do any work in Boston. Free 2011 tax software Instead, you receive classroom and on-the-job training throughout the United States. Free 2011 tax software You keep your apartment in Boston and return to it frequently. Free 2011 tax software You use your apartment to conduct your personal business. Free 2011 tax software You also keep up your community contacts in Boston. Free 2011 tax software When you complete your training, you are transferred to Los Angeles. Free 2011 tax software You do not satisfy factor (1) because you did not work in Boston. Free 2011 tax software You satisfy factor (2) because you had duplicate living expenses. Free 2011 tax software You also satisfy factor (3) because you did not abandon your apartment in Boston as your main home, you kept your community contacts, and you frequently returned to live in your apartment. Free 2011 tax software Therefore, you have a tax home in Boston. Free 2011 tax software Example 2. Free 2011 tax software You are an outside salesperson with a sales territory covering several states. Free 2011 tax software Your employer's main office is in Newark, but you do not conduct any business there. Free 2011 tax software Your work assignments are temporary, and you have no way of knowing where your future assignments will be located. Free 2011 tax software You have a room in your married sister's house in Dayton. Free 2011 tax software You stay there for one or two weekends a year, but you do no work in the area. Free 2011 tax software You do not pay your sister for the use of the room. Free 2011 tax software You do not satisfy any of the three factors listed earlier. Free 2011 tax software You are an itinerant and have no tax home. Free 2011 tax software Tax Home Different From Family Home If you (and your family) do not live at your tax home (defined earlier), you cannot deduct the cost of traveling between your tax home and your family home. Free 2011 tax software You also cannot deduct the cost of meals and lodging while at your tax home. Free 2011 tax software See Example 1 , later. Free 2011 tax software If you are working temporarily in the same city where you and your family live, you may be considered as traveling away from home. Free 2011 tax software See Example 2 , later. Free 2011 tax software Example 1. Free 2011 tax software You are a truck driver and you and your family live in Tucson. Free 2011 tax software You are employed by a trucking firm that has its terminal in Phoenix. Free 2011 tax software At the end of your long runs, you return to your home terminal in Phoenix and spend one night there before returning home. Free 2011 tax software You cannot deduct any expenses you have for meals and lodging in Phoenix or the cost of traveling from Phoenix to Tucson. Free 2011 tax software This is because Phoenix is your tax home. Free 2011 tax software Example 2. Free 2011 tax software Your family home is in Pittsburgh, where you work 12 weeks a year. Free 2011 tax software The rest of the year you work for the same employer in Baltimore. Free 2011 tax software In Baltimore, you eat in restaurants and sleep in a rooming house. Free 2011 tax software Your salary is the same whether you are in Pittsburgh or Baltimore. Free 2011 tax software Because you spend most of your working time and earn most of your salary in Baltimore, that city is your tax home. Free 2011 tax software You cannot deduct any expenses you have for meals and lodging there. Free 2011 tax software However, when you return to work in Pittsburgh, you are away from your tax home even though you stay at your family home. Free 2011 tax software You can deduct the cost of your round trip between Baltimore and Pittsburgh. Free 2011 tax software You can also deduct your part of your family's living expenses for meals and lodging while you are living and working in Pittsburgh. Free 2011 tax software Temporary Assignment or Job You may regularly work at your tax home and also work at another location. Free 2011 tax software It may not be practical to return to your tax home from this other location at the end of each work day. Free 2011 tax software Temporary assignment vs. Free 2011 tax software indefinite assignment. Free 2011 tax software   If your assignment or job away from your main place of work is temporary, your tax home does not change. Free 2011 tax software You are considered to be away from home for the whole period you are away from your main place of work. Free 2011 tax software You can deduct your travel expenses if they otherwise qualify for deduction. Free 2011 tax software Generally, a temporary assignment in a single location is one that is realistically expected to last (and does in fact last) for 1 year or less. Free 2011 tax software    However, if your assignment or job is indefinite, the location of the assignment or job becomes your new tax home and you cannot deduct your travel expenses while there. Free 2011 tax software An assignment or job in a single location is considered indefinite if it is realistically expected to last for more than 1 year, whether or not it actually lasts for more than 1 year. Free 2011 tax software   If your assignment is indefinite, you must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances and you account to your employer for them. Free 2011 tax software You may be able to deduct the cost of relocating to your new tax home as a moving expense. Free 2011 tax software See Publication 521 for more information. Free 2011 tax software Exception for federal crime investigations or prosecutions. Free 2011 tax software   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule. Free 2011 tax software This means you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year provided you meet the other requirements for deductibility. Free 2011 tax software   For you to qualify, the Attorney General (or his or her designee) must certify that you are traveling: For the federal government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. Free 2011 tax software Determining temporary or indefinite. Free 2011 tax software   You must determine whether your assignment is temporary or indefinite when you start work. Free 2011 tax software If you expect an assignment or job to last for 1 year or less, it is temporary unless there are facts and circumstances that indicate otherwise. Free 2011 tax software An assignment or job that is initially temporary may become indefinite due to changed circumstances. Free 2011 tax software A series of assignments to the same location, all for short periods but that together cover a long period, may be considered an indefinite assignment. Free 2011 tax software   The following examples illustrate whether an assignment or job is temporary or indefinite. Free 2011 tax software Example 1. Free 2011 tax software You are a construction worker. Free 2011 tax software You live and regularly work in Los Angeles. Free 2011 tax software You are a member of a trade union in Los Angeles that helps you get work in the Los Angeles area. Free 2011 tax software Your tax home is Los Angeles. Free 2011 tax software Because of a shortage of work, you took a job on a construction project in Fresno. Free 2011 tax software Your job was scheduled to end in 8 months. Free 2011 tax software The job actually lasted 10 months. Free 2011 tax software You realistically expected the job in Fresno to last 8 months. Free 2011 tax software The job actually did last less than 1 year. Free 2011 tax software The job is temporary and your tax home is still in Los Angeles. Free 2011 tax software Example 2. Free 2011 tax software The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 18 months. Free 2011 tax software The job actually was completed in 10 months. Free 2011 tax software Your job in Fresno is indefinite because you realistically expected the work to last longer than 1 year, even though it actually lasted less than 1 year. Free 2011 tax software You cannot deduct any travel expenses you had in Fresno because Fresno became your tax home. Free 2011 tax software Example 3. Free 2011 tax software The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 9 months. Free 2011 tax software After 8 months, however, you were asked to remain for 7 more months (for a total actual stay of 15 months). Free 2011 tax software Initially, you realistically expected the job in Fresno to last for only 9 months. Free 2011 tax software However, due to changed circumstances occurring after 8 months, it was no longer realistic for you to expect that the job in Fresno would last for 1 year or less. Free 2011 tax software You can only deduct your travel expenses for the first 8 months. Free 2011 tax software You cannot deduct any travel expenses you had after that time because Fresno became your tax home when the job became indefinite. Free 2011 tax software Going home on days off. Free 2011 tax software   If you go back to your tax home from a temporary assignment on your days off, you are not considered away from home while you are in your hometown. Free 2011 tax software You cannot deduct the cost of your meals and lodging there. Free 2011 tax software However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home. Free 2011 tax software You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. Free 2011 tax software   If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. Free 2011 tax software In addition, you can deduct your expenses of returning home up to the amount you would have spent for meals had you stayed at your temporary place of work. Free 2011 tax software Probationary work period. Free 2011 tax software   If you take a job that requires you to move, with the understanding that you will keep the job if your work is satisfactory during a probationary period, the job is indefinite. Free 2011 tax software You cannot deduct any of your expenses for meals and lodging during the probationary period. Free 2011 tax software What Travel Expenses Are Deductible? Once you have determined that you are traveling away from your tax home, you can determine what travel expenses are deductible. Free 2011 tax software You can deduct ordinary and necessary expenses you have when you travel away from home on business. Free 2011 tax software The type of expense you can deduct depends on the facts and your circumstances. Free 2011 tax software Table 1-1 summarizes travel expenses you may be able to deduct. Free 2011 tax software You may have other deductible travel expenses that are not covered there, depending on the facts and your circumstances. Free 2011 tax software When you travel away from home on business, you should keep records of all the expenses you have and any advances you receive from your employer. Free 2011 tax software You can use a log, diary, notebook, or any other written record to keep track of your expenses. Free 2011 tax software The types of expenses you need to record, along with supporting documentation, are described in Table 5-1 (see chapter 5). Free 2011 tax software Separating costs. Free 2011 tax software   If you have one expense that includes the costs of meals, entertainment, and other services (such as lodging or transportation), you must allocate that expense between the cost of meals and entertainment and the cost of other services. Free 2011 tax software You must have a reasonable basis for making this allocation. Free 2011 tax software For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. Free 2011 tax software Travel expenses for another individual. Free 2011 tax software    If a spouse, dependent, or other individual goes with you (or your employee) on a business trip or to a business convention, you generally cannot deduct his or her travel expenses. Free 2011 tax software Employee. Free 2011 tax software   You can deduct the travel expenses of someone who goes with you if that person: Is your employee, Has a bona fide business purpose for the travel, and Would otherwise be allowed to deduct the travel expenses. Free 2011 tax software Business associate. Free 2011 tax software   If a business associate travels with you and meets the conditions in (2) and (3), earlier, you can deduct the travel expenses you have for that person. Free 2011 tax software A business associate is someone with whom you could reasonably expect to actively conduct business. Free 2011 tax software A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor. Free 2011 tax software Bona fide business purpose. Free 2011 tax software   A bona fide business purpose exists if you can prove a real business purpose for the individual's presence. Free 2011 tax software Incidental services, such as typing notes or assisting in entertaining customers, are not enough to make the expenses deductible. Free 2011 tax software Table 1-1. Free 2011 tax software Travel Expenses You Can Deduct   This chart summarizes expenses you can deduct when you travel away from home for business purposes. Free 2011 tax software IF you have expenses for. Free 2011 tax software . Free 2011 tax software . Free 2011 tax software THEN you can deduct the cost of. Free 2011 tax software . Free 2011 tax software . Free 2011 tax software transportation travel by airplane, train, bus, or car between your home and your business destination. Free 2011 tax software If you were provided with a free ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero. Free 2011 tax software If you travel by ship, see Luxury Water Travel and Cruise Ships (under Conventions) for additional rules and limits. Free 2011 tax software taxi, commuter bus, and airport limousine fares for these and other types of transportation that take you between: The airport or station and your hotel, and The hotel and the work location of your customers or clients, your business meeting place, or your temporary work location. Free 2011 tax software baggage and shipping sending baggage and sample or display material between your regular and temporary work locations. Free 2011 tax software car operating and maintaining your car when traveling away from home on business. Free 2011 tax software You can deduct actual expenses or the standard mileage rate, as well as business-related tolls and parking. Free 2011 tax software If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Free 2011 tax software lodging and meals your lodging and meals if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. Free 2011 tax software Meals include amounts spent for food, beverages, taxes, and related tips. Free 2011 tax software See Meals for additional rules and limits. Free 2011 tax software cleaning dry cleaning and laundry. Free 2011 tax software telephone business calls while on your business trip. Free 2011 tax software This includes business communication by fax machine or other communication devices. Free 2011 tax software tips tips you pay for any expenses in this chart. Free 2011 tax software other other similar ordinary and necessary expenses related to your business travel. Free 2011 tax software These expenses might include transportation to or from a business meal, public stenographer's fees, computer rental fees, and operating and maintaining a house trailer. Free 2011 tax software Example. Free 2011 tax software Jerry drives to Chicago on business and takes his wife, Linda, with him. Free 2011 tax software Linda is not Jerry's employee. Free 2011 tax software Linda occasionally types notes, performs similar services, and accompanies Jerry to luncheons and dinners. Free 2011 tax software The performance of these services does not establish that her presence on the trip is necessary to the conduct of Jerry's business. Free 2011 tax software Her expenses are not deductible. Free 2011 tax software Jerry pays $199 a day for a double room. Free 2011 tax software A single room costs $149 a day. Free 2011 tax software He can deduct the total cost of driving his car to and from Chicago, but only $149 a day for his hotel room. Free 2011 tax software If he uses public transportation, he can deduct only his fare. Free 2011 tax software Meals You can deduct the cost of meals in either of the following situations. Free 2011 tax software It is necessary for you to stop for substantial sleep or rest to properly perform your duties while traveling away from home on business. Free 2011 tax software The meal is business-related entertainment. Free 2011 tax software Business-related entertainment is discussed in chapter 2 . Free 2011 tax software The following discussion deals only with meals that are not business-related entertainment. Free 2011 tax software Lavish or extravagant. Free 2011 tax software   You cannot deduct expenses for meals that are lavish or extravagant. Free 2011 tax software An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. Free 2011 tax software Expenses will not be disallowed merely because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. Free 2011 tax software 50% limit on meals. Free 2011 tax software   You can figure your meals expense using either of the following methods. Free 2011 tax software Actual cost. Free 2011 tax software The standard meal allowance. Free 2011 tax software Both of these methods are explained below. Free 2011 tax software But, regardless of the method you use, you generally can deduct only 50% of the unreimbursed cost of your meals. Free 2011 tax software   If you are reimbursed for the cost of your meals, how you apply the 50% limit depends on whether your employer's reimbursement plan was accountable or nonaccountable. Free 2011 tax software If you are not reimbursed, the 50% limit applies whether the unreimbursed meal expense is for business travel or business entertainment. Free 2011 tax software Chapter 2 discusses the 50% Limit in more detail, and chapter 6 discusses accountable and nonaccountable plans. Free 2011 tax software Actual Cost You can use the actual cost of your meals to figure the amount of your expense before reimbursement and application of the 50% deduction limit. Free 2011 tax software If you use this method, you must keep records of your actual cost. Free 2011 tax software Standard Meal Allowance Generally, you can use the “standard meal allowance” method as an alternative to the actual cost method. Free 2011 tax software It allows you to use a set amount for your daily meals and incidental expenses (M&IE), instead of keeping records of your actual costs. Free 2011 tax software The set amount varies depending on where and when you travel. Free 2011 tax software In this publication, “standard meal allowance” refers to the federal rate for M&IE, discussed later under Amount of standard meal allowance . Free 2011 tax software If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel. Free 2011 tax software See the recordkeeping rules for travel in chapter 5 . Free 2011 tax software Incidental expenses. Free 2011 tax software   The term “incidental expenses” means fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. Free 2011 tax software   Incidental expenses do not include expenses for laundry, cleaning and pressing of clothing, lodging taxes, costs of telegrams or telephone calls, transportation between places of lodging or business and places where meals are taken, or the mailing cost of filing travel vouchers and paying employer-sponsored charge card billings. Free 2011 tax software Incidental-expenses-only method. Free 2011 tax software   You can use an optional method (instead of actual cost) for deducting incidental expenses only. Free 2011 tax software The amount of the deduction is $5 a day. Free 2011 tax software You can use this method only if you did not pay or incur any meal expenses. Free 2011 tax software You cannot use this method on any day that you use the standard meal allowance. Free 2011 tax software This method is subject to the proration rules for partial days. Free 2011 tax software See Travel for days you depart and return , later in this chapter. Free 2011 tax software Note. Free 2011 tax software The incidental-expenses-only method is not subject to the 50% limit discussed below. Free 2011 tax software Federal employees should refer to the Federal Travel Regulations at www. Free 2011 tax software gsa. Free 2011 tax software gov. Free 2011 tax software Find the “Most Requested Links” on the upper left and click on “Regulations: FAR, FMR, FTR” for Federal Travel Regulation (FTR) for changes affecting claims for reimbursement. Free 2011 tax software 50% limit may apply. Free 2011 tax software   If you use the standard meal allowance method for meal expenses and you are not reimbursed or you are reimbursed under a nonaccountable plan, you can generally deduct only 50% of the standard meal allowance. Free 2011 tax software If you are reimbursed under an accountable plan and you are deducting amounts that are more than your reimbursements, you can deduct only 50% of the excess amount. Free 2011 tax software The 50% limit is discussed in more detail in chapter 2, and accountable and nonaccountable plans are discussed in chapter 6. Free 2011 tax software There is no optional standard lodging amount similar to the standard meal allowance. Free 2011 tax software Your allowable lodging expense deduction is your actual cost. Free 2011 tax software Who can use the standard meal allowance. Free 2011 tax software   You can use the standard meal allowance whether you are an employee or self-employed, and whether or not you are reimbursed for your traveling expenses. Free 2011 tax software Use of the standard meal allowance for other travel. Free 2011 tax software   You can use the standard meal allowance to figure your meal expenses when you travel in connection with investment and other income-producing property. Free 2011 tax software You can also use it to figure your meal expenses when you travel for qualifying educational purposes. Free 2011 tax software You cannot use the standard meal allowance to figure the cost of your meals when you travel for medical or charitable purposes. Free 2011 tax software Amount of standard meal allowance. Free 2011 tax software   The standard meal allowance is the federal M&IE rate. Free 2011 tax software For travel in 2013, the rate for most small localities in the United States is $46 a day. Free 2011 tax software    Most major cities and many other localities in the United States are designated as high-cost areas, qualifying for higher standard meal allowances. Free 2011 tax software    You can find this information (organized by state) on the Internet at www. Free 2011 tax software gsa. Free 2011 tax software gov/perdiem. Free 2011 tax software Enter a zip code or select a city and state for the per diem rates for the current fiscal year. Free 2011 tax software Per diem rates for prior fiscal years are available by using the drop down menu under “Search by State. Free 2011 tax software ”   Per diem rates are listed by the Federal government's fiscal year which runs from October 1 to September 30. Free 2011 tax software You can choose to use the rates from the 2013 fiscal year per diem tables or the rates from the 2014 fiscal year tables, but you must consistently use the same tables for all travel you are reporting on your income tax return for the year. Free 2011 tax software   If you travel to more than one location in one day, use the rate in effect for the area where you stop for sleep or rest. Free 2011 tax software If you work in the transportation industry, however, see Special rate for transportation workers , later. Free 2011 tax software Standard meal allowance for areas outside the continental United States. Free 2011 tax software   The standard meal allowance rates above do not apply to travel in Alaska, Hawaii, or any other location outside the continental United States. Free 2011 tax software The Department of Defense establishes per diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U. Free 2011 tax software S. Free 2011 tax software Virgin Islands, Wake Island, and other non-foreign areas outside the continental United States. Free 2011 tax software The Department of State establishes per diem rates for all other foreign areas. Free 2011 tax software    You can access per diem rates for non-foreign areas outside the continental United States at: www. Free 2011 tax software defensetravel. Free 2011 tax software dod. Free 2011 tax software mil/site/perdiemCalc. Free 2011 tax software cfm. Free 2011 tax software You can access all other foreign per diem rates at: www. Free 2011 tax software state. Free 2011 tax software gov/travel/. Free 2011 tax software Click on “Travel Per Diem Allowances for Foreign Areas,” under “Foreign Per Diem Rates” to obtain the latest foreign per diem rates. Free 2011 tax software Special rate for transportation workers. Free 2011 tax software   You can use a special standard meal allowance if you work in the transportation industry. Free 2011 tax software You are in the transportation industry if your work: Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates. Free 2011 tax software If this applies to you, you can claim a standard meal allowance of $59 a day ($65 for travel outside the continental United States). Free 2011 tax software   Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area where you stop for sleep or rest. Free 2011 tax software If you choose to use the special rate for any trip, you must use the special rate (and not use the regular standard meal allowance rates) for all trips you take that year. Free 2011 tax software Travel for days you depart and return. Free 2011 tax software   For both the day you depart for and the day you return from a business trip, you must prorate the standard meal allowance (figure a reduced amount for each day). Free 2011 tax software You can do so by one of two methods. Free 2011 tax software Method 1: You can claim 3/4 of the standard meal allowance. Free 2011 tax software Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice. Free 2011 tax software Example. Free 2011 tax software Jen is employed in New Orleans as a convention planner. Free 2011 tax software In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. Free 2011 tax software She left her home in New Orleans at 10 a. Free 2011 tax software m. Free 2011 tax software on Wednesday and arrived in Washington, DC, at 5:30 p. Free 2011 tax software m. Free 2011 tax software After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p. Free 2011 tax software m. Free 2011 tax software Jen's employer gave her a flat amount to cover her expenses and included it with her wages. Free 2011 tax software Under Method 1, Jen can claim 2½ days of the standard meal allowance for Washington, DC: 3/4 of the daily rate for Wednesday and Friday (the days she departed and returned), and the full daily rate for Thursday. Free 2011 tax software Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. Free 2011 tax software For example, she could claim 3 days of the standard meal allowance even though a federal employee would have to use Method 1 and be limited to only 2½ days. Free 2011 tax software Travel in the United States The following discussion applies to travel in the United States. Free 2011 tax software For this purpose, the United States includes the 50 states and the District of Columbia. Free 2011 tax software The treatment of your travel expenses depends on how much of your trip was business related and on how much of your trip occurred within the United States. Free 2011 tax software See Part of Trip Outside the United States , later. Free 2011 tax software Trip Primarily for Business You can deduct all of your travel expenses if your trip was entirely business related. Free 2011 tax software If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct only your business-related travel expenses. Free 2011 tax software These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination. Free 2011 tax software Example. Free 2011 tax software You work in Atlanta and take a business trip to New Orleans in May. Free 2011 tax software Your business travel totals 850 miles round trip. Free 2011 tax software On your way, you stop in Mobile to visit your parents. Free 2011 tax software You spend $2,120 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. Free 2011 tax software If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,820. Free 2011 tax software You can deduct $1,820 for your trip, including the cost of round-trip transportation to and from New Orleans. Free 2011 tax software The deduction for your meals is subject to the 50% limit on meals mentioned earlier. Free 2011 tax software Trip Primarily for Personal Reasons If your trip was primarily for personal reasons, such as a vacation, the entire cost of the trip is a nondeductible personal expense. Free 2011 tax software However, you can deduct any expenses you have while at your destination that are directly related to your business. Free 2011 tax software A trip to a resort or on a cruise ship may be a vacation even if the promoter advertises that it is primarily for business. Free 2011 tax software The scheduling of incidental business activities during a trip, such as viewing videotapes or attending lectures dealing with general subjects, will not change what is really a vacation into a business trip. Free 2011 tax software Part of Trip Outside the United States If part of your trip is outside the United States, use the rules described later in this chapter under Travel Outside the United States for that part of the trip. Free 2011 tax software For the part of your trip that is inside the United States, use the rules for travel in the United States. Free 2011 tax software Travel outside the United States does not include travel from one point in the United States to another point in the United States. Free 2011 tax software The following discussion can help you determine whether your trip was entirely within the United States. Free 2011 tax software Public transportation. Free 2011 tax software   If you travel by public transportation, any place in the United States where that vehicle makes a scheduled stop is a point in the United States. Free 2011 tax software Once the vehicle leaves the last scheduled stop in the United States on its way to a point outside the United States, you apply the rules under Travel Outside the United States . Free 2011 tax software Example. Free 2011 tax software You fly from New York to Puerto Rico with a scheduled stop in Miami. Free 2011 tax software You return to New York nonstop. Free 2011 tax software The flight from New York to Miami is in the United States, so only the flight from Miami to Puerto Rico is outside the United States. Free 2011 tax software Because there are no scheduled stops between Puerto Rico and New York, all of the return trip is outside the United States. Free 2011 tax software Private car. Free 2011 tax software   Travel by private car in the United States is travel between points in the United States, even though you are on your way to a destination outside the United States. Free 2011 tax software Example. Free 2011 tax software You travel by car from Denver to Mexico City and return. Free 2011 tax software Your travel from Denver to the border and from the border back to Denver is travel in the United States, and the rules in this section apply. Free 2011 tax software The rules under Travel Outside the United States apply to your trip from the border to Mexico City and back to the border. Free 2011 tax software Travel Outside the United States If any part of your business travel is outside the United States, some of your deductions for the cost of getting to and from your destination may be limited. Free 2011 tax software For this purpose, the United States includes the 50 states and the District of Columbia. Free 2011 tax software How much of your travel expenses you can deduct depends in part upon how much of your trip outside the United States was business related. Free 2011 tax software Travel Entirely for Business or Considered Entirely for Business You can deduct all your travel expenses of getting to and from your business destination if your trip is entirely for business or considered entirely for business. Free 2011 tax software Travel entirely for business. Free 2011 tax software   If you travel outside the United States and you spend the entire time on business activities, you can deduct all of your travel expenses. Free 2011 tax software Travel considered entirely for business. Free 2011 tax software   Even if you did not spend your entire time on business activities, your trip is considered entirely for business if you meet at least one of the following four exceptions. Free 2011 tax software Exception 1 - No substantial control. Free 2011 tax software   Your trip is considered entirely for business if you did not have substantial control over arranging the trip. Free 2011 tax software The fact that you control the timing of your trip does not, by itself, mean that you have substantial control over arranging your trip. Free 2011 tax software   You do not have substantial control over your trip if you: Are an employee who was reimbursed or paid a travel expense allowance, and Are not related to your employer, or Are not a managing executive. Free 2011 tax software    “Related to your employer” is defined later in chapter 6 under Per Diem and Car Allowances . Free 2011 tax software   A “managing executive” is an employee who has the authority and responsibility, without being subject to the veto of another, to decide on the need for the business travel. Free 2011 tax software   A self-employed person generally has substantial control over arranging business trips. Free 2011 tax software Exception 2 - Outside United States no more than a week. Free 2011 tax software   Your trip is considered entirely for business if you were outside the United States for a week or less, combining business and nonbusiness activities. Free 2011 tax software One week means 7 consecutive days. Free 2011 tax software In counting the days, do not count the day you leave the United States, but do count the day you return to the United States. Free 2011 tax software Example. Free 2011 tax software You traveled to Brussels primarily for business. Free 2011 tax software You left Denver on Tuesday and flew to New York. Free 2011 tax software On Wednesday, you flew from New York to Brussels, arriving the next morning. Free 2011 tax software On Thursday and Friday, you had business discussions, and from Saturday until Tuesday, you were sightseeing. Free 2011 tax software You flew back to New York, arriving Wednesday afternoon. Free 2011 tax software On Thursday, you flew back to Denver. Free 2011 tax software Although you were away from your home in Denver for more than a week, you were not outside the United States for more than a week. Free 2011 tax software This is because the day you depart does not count as a day outside the United States. Free 2011 tax software You can deduct your cost of the round-trip flight between Denver and Brussels. Free 2011 tax software You can also deduct the cost of your stay in Brussels for Thursday and Friday while you conducted business. Free 2011 tax software However, you cannot deduct the cost of your stay in Brussels from Saturday through Tuesday because those days were spent on nonbusiness activities. Free 2011 tax software Exception 3 - Less than 25% of time on personal activities. Free 2011 tax software   Your trip is considered entirely for business if: You were outside the United States for more than a week, and You spent less than 25% of the total time you were outside the United States on nonbusiness activities. Free 2011 tax software For this purpose, count both the day your trip began and the day it ended. Free 2011 tax software Example. Free 2011 tax software You flew from Seattle to Tokyo, where you spent 14 days on business and 5 days on personal matters. Free 2011 tax software You then flew back to Seattle. Free 2011 tax software You spent 1 day flying in each direction. Free 2011 tax software Because only 5/21 (less than 25%) of your total time abroad was for nonbusiness activities, you can deduct as travel expenses what it would have cost you to make the trip if you had not engaged in any nonbusiness activity. Free 2011 tax software The amount you can deduct is the cost of the round-trip plane fare and 16 days of meals (subject to the 50% limit), lodging, and other related expenses. Free 2011 tax software Exception 4 - Vacation not a major consideration. Free 2011 tax software   Your trip is considered entirely for business if you can establish that a personal vacation was not a major consideration, even if you have substantial control over arranging the trip. Free 2011 tax software Travel Primarily for Business If you travel outside the United States primarily for business but spend some of your time on other activities, you generally cannot deduct all of your travel expenses. Free 2011 tax software You can only deduct the business portion of your cost of getting to and from your destination. Free 2011 tax software You must allocate the costs between your business and other activities to determine your deductible amount. Free 2011 tax software See Travel allocation rules , later. Free 2011 tax software You do not have to allocate your travel expenses if you meet one of the four exceptions listed earlier under Travel considered entirely for business . Free 2011 tax software In those cases, you can deduct the total cost of getting to and from your destination. Free 2011 tax software Travel allocation rules. Free 2011 tax software   If your trip outside the United States was primarily for business, you must allocate your travel time on a day-to-day basis between business days and nonbusiness days. Free 2011 tax software The days you depart from and return to the United States are both counted as days outside the United States. Free 2011 tax software   To figure the deductible amount of your round-trip travel expenses, use the following fraction. Free 2011 tax software The numerator (top number) is the total number of business days outside the United States. Free 2011 tax software The denominator (bottom number) is the total number of business and nonbusiness days of travel. Free 2011 tax software Counting business days. Free 2011 tax software   Your business days include transportation days, days your presence was required, days you spent on business, and certain weekends and holidays. Free 2011 tax software Transportation day. Free 2011 tax software   Count as a business day any day you spend traveling to or from a business destination. Free 2011 tax software However, if because of a nonbusiness activity you do not travel by a direct route, your business days are the days it would take you to travel a reasonably direct route to your business destination. Free 2011 tax software Extra days for side trips or nonbusiness activities cannot be counted as business days. Free 2011 tax software Presence required. Free 2011 tax software   Count as a business day any day your presence is required at a particular place for a specific business purpose. Free 2011 tax software Count it as a business day even if you spend most of the day on nonbusiness activities. Free 2011 tax software Day spent on business. Free 2011 tax software   If your principal activity during working hours is the pursuit of your trade or business, count the day as a business day. Free 2011 tax software Also, count as a business day any day you are prevented from working because of circumstances beyond your control. Free 2011 tax software Certain weekends and holidays. Free 2011 tax software   Count weekends, holidays, and other necessary standby days as business days if they fall between business days. Free 2011 tax software But if they follow your business meetings or activity and you remain at your business destination for nonbusiness or personal reasons, do not count them as business days. Free 2011 tax software Example 1. Free 2011 tax software Your tax home is New York City. Free 2011 tax software You travel to Quebec, where you have a business appointment on Friday. Free 2011 tax software You have another appointment on the following Monday. Free 2011 tax software Because your presence was required on both Friday and Monday, they are business days. Free 2011 tax software Because the weekend is between business days, Saturday and Sunday are counted as business days. Free 2011 tax software This is true even though you use the weekend for sightseeing, visiting friends, or other nonbusiness activity. Free 2011 tax software Example 2. Free 2011 tax software If, in Example 1, you had no business in Quebec after Friday, but stayed until Monday before starting home, Saturday and Sunday would be nonbusiness days. Free 2011 tax software Nonbusiness activity on the way to or from your business destination. Free 2011 tax software   If you stopped for a vacation or other nonbusiness activity either on the way from the United States to your business destination, or on the way back to the United States from your business destination, you must allocate part of your travel expenses to the nonbusiness activity. Free 2011 tax software   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your nonbusiness destination and a return to the point where travel outside the United States ends. Free 2011 tax software   You determine the nonbusiness portion of that expense by multiplying it by a fraction. Free 2011 tax software The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. Free 2011 tax software Example. Free 2011 tax software You live in New York. Free 2011 tax software On May 4 you flew to Paris to attend a business conference that began on May 5. Free 2011 tax software The conference ended at noon on May 14. Free 2011 tax software That evening you flew to Dublin where you visited with friends until the afternoon of May 21, when you flew directly home to New York. Free 2011 tax software The primary purpose for the trip was to attend the conference. Free 2011 tax software If you had not stopped in Dublin, you would have arrived home the evening of May 14. Free 2011 tax software You do not meet any of the exceptions that would allow you to consider your travel entirely for business. Free 2011 tax software May 4 through May 14 (11 days) are business days and May 15 through May 21 (7 days) are nonbusiness days. Free 2011 tax software You can deduct the cost of your meals (subject to the 50% limit), lodging, and other business-related travel expenses while in Paris. Free 2011 tax software You cannot deduct your expenses while in Dublin. Free 2011 tax software You also cannot deduct 7/18 of what it would have cost you to travel round-trip between New York and Dublin. Free 2011 tax software You paid $750 to fly from New York to Paris, $400 to fly from Paris to Dublin, and $700 to fly from Dublin back to New York. Free 2011 tax software Round-trip airfare from New York to Dublin would have been $1,250. Free 2011 tax software You figure the deductible part of your air travel expenses by subtracting 7/18 of the round-trip fare and other expenses you would have had in traveling directly between New York and Dublin ($1,250 × 7/18 = $486) from your total expenses in traveling from New York to Paris to Dublin and back to New York ($750 + $400 + $700 = $1,850). Free 2011 tax software Your deductible air travel expense is $1,364 ($1,850 − $486). Free 2011 tax software Nonbusiness activity at, near, or beyond business destination. Free 2011 tax software   If you had a vacation or other nonbusiness activity at, near, or beyond your business destination, you must allocate part of your travel expenses to the nonbusiness activity. Free 2011 tax software   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your business destination and a return to the point where travel outside the United States ends. Free 2011 tax software   You determine the nonbusiness portion of that expense by multiplying it by a fraction. Free 2011 tax software The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. Free 2011 tax software   None of your travel expenses for nonbusiness activities at, near, or beyond your business destination are deductible. Free 2011 tax software Example. Free 2011 tax software Assume that the dates are the same as in the previous example but that instead of going to Dublin for your vacation, you fly to Venice, Italy, for a vacation. Free 2011 tax software You cannot deduct any part of the cost of your trip from Paris to Venice and return to Paris. Free 2011 tax software In addition, you cannot deduct 7/18 of the airfare and other expenses from New York to Paris and back to New York. Free 2011 tax software You can deduct 11/18 of the round-trip plane fare and other travel expenses from New York to Paris, plus your meals (subject to the 50% limit), lodging, and any other business expenses you had in Paris. Free 2011 tax software (Assume these expenses total $4,939. Free 2011 tax software ) If the round-trip plane fare and other travel-related expenses (such as food during the trip) are $1,750, you can deduct travel costs of $1,069 (11/18 × $1,750), plus the full $4,939 for the expenses you had in Paris. Free 2011 tax software Other methods. Free 2011 tax software   You can use another method of counting business days if you establish that it more clearly reflects the time spent on other than business activities outside the United States. Free 2011 tax software Travel Primarily for Personal Reasons If you travel outside the United States primarily for vacation or for investment purposes, the entire cost of the trip is a nondeductible personal expense. Free 2011 tax software However, if you spend some time attending brief professional seminars or a continuing education program, you can deduct your registration fees and other expenses you have that are directly related to your business. Free 2011 tax software Example. Free 2011 tax software The university from which you graduated has a continuing education program for members of its alumni association. Free 2011 tax software This program consists of trips to various foreign countries where academic exercises and conferences are set up to acquaint individuals in most occupations with selected facilities in several regions of the world. Free 2011 tax software However, none of the conferences are directed toward specific occupations or professions. Free 2011 tax software It is up to each participant to seek out specialists and organizational settings appropriate to his or her occupational interests. Free 2011 tax software Three-hour sessions are held each day over a 5-day period at each of the selected overseas facilities where participants can meet with individual practitioners. Free 2011 tax software These sessions are composed of a variety of activities including workshops, mini-lectures, role playing, skill development, and exercises. Free 2011 tax software Professional conference directors schedule and conduct the sessions. Free 2011 tax software Participants can choose those sessions they wish to attend. Free 2011 tax software You can participate in this program since you are a member of the alumni association. Free 2011 tax software You and your family take one of the trips. Free 2011 tax software You spend about 2 hours at each of the planned sessions. Free 2011 tax software The rest of the time you go touring and sightseeing with your family. Free 2011 tax software The trip lasts less than 1 week. Free 2011 tax software Your travel expenses for the trip are not deductible since the trip was primarily a vacation. Free 2011 tax software However, registration fees and any other incidental expenses you have for the five planned sessions you attended that are directly related and beneficial to your business are deductible business expenses. Free 2011 tax software These expenses should be specifically stated in your records to ensure proper allocation of your deductible business expenses. Free 2011 tax software Luxury Water Travel If you travel by ocean liner, cruise ship, or other form of luxury water transportation for business purposes, there is a daily limit on the amount you can deduct. Free 2011 tax software The limit is twice the highest federal per diem rate allowable at the time of your travel. Free 2011 tax software (Generally, the federal per diem is the amount paid to federal government employees for daily living expenses when they travel away from home, but in the United States, for business purposes. Free 2011 tax software ) Daily limit on luxury water travel. Free 2011 tax software   The highest federal per diem rate allowed and the daily limit for luxury water travel in 2013 is shown in the following table. Free 2011 tax software   2013 Dates Highest Federal Per Diem Daily Limit on Luxury Water Travel   Jan. Free 2011 tax software 1 – Mar. Free 2011 tax software 31 $367 $734   Apr. Free 2011 tax software 1 – June 30 312 624   July 1 – Aug. Free 2011 tax software 31 310 620   Sept. Free 2011 tax software 1 – Sept. Free 2011 tax software 30 366 732   Oct. Free 2011 tax software 1 – Dec. Free 2011 tax software 31 374 748 Example. Free 2011 tax software Caroline, a travel agent, traveled by ocean liner from New York to London, England, on business in May. Free 2011 tax software Her expense for the 6-day cruise was $5,200. Free 2011 tax software Caroline's deduction for the cruise cannot exceed $3,744 (6 days × $624 daily limit). Free 2011 tax software Meals and entertainment. Free 2011 tax software   If your expenses for luxury water travel include separately stated amounts for meals or entertainment, those amounts are subject to the 50% limit on meals and entertainment before you apply the daily limit. Free 2011 tax software For a discussion of the 50% Limit , see chapter 2. Free 2011 tax software Example. Free 2011 tax software In the previous example, Caroline's luxury water travel had a total cost of $5,200. Free 2011 tax software Of that amount, $3,700 was separately stated as meals and entertainment. Free 2011 tax software Caroline, who is self-employed, is not reimbursed for any of her travel expenses. Free 2011 tax software Caroline figures her deductible travel expenses as follows. Free 2011 tax software Meals and entertainment $3,700   50% limit × . Free 2011 tax software 50   Allowable meals &     entertainment $1,850   Other travel expenses + 1,800   Allowable cost before the daily limit $3,650 Daily limit for May 2013 $624   Times number of days × 6   Maximum luxury water travel     deduction $3,744 Amount of allowable deduction $3,650 Caroline's deduction for her cruise is limited to $3,650, even though the limit on luxury water travel is slightly higher. Free 2011 tax software Not separately stated. Free 2011 tax software   If your meal or entertainment charges are not separately stated or are not clearly identifiable, you do not have to allocate any portion of the total charge to meals or entertainment. Free 2011 tax software Exceptions The daily limit on luxury water travel (discussed earlier) does not apply to expenses you have to attend a convention, seminar, or meeting on board a cruise ship. Free 2011 tax software See Cruise Ships under Conventions. Free 2011 tax software Conventions You can deduct your travel expenses when you attend a convention if you can show that your attendance benefits your trade or business. Free 2011 tax software You cannot deduct the travel expenses for your family. Free 2011 tax software If the convention is for investment, political, social, or other purposes unrelated to your trade or business, you cannot deduct the expenses. Free 2011 tax software Your appointment or election as a delegate does not, in itself, determine whether you can deduct travel expenses. Free 2011 tax software You can deduct your travel expenses only if your attendance is connected to your own trade or business. Free 2011 tax software Convention agenda. Free 2011 tax software   The convention agenda or program generally shows the purpose of the convention. Free 2011 tax software You can show your attendance at the convention benefits your trade or business by comparing the agenda with the official duties and responsibilities of your position. Free 2011 tax software The agenda does not have to deal specifically with your official duties and responsibilities; it will be enough if the agenda is so related to your position that it shows your attendance was for business purposes. Free 2011 tax software Conventions Held Outside the North American Area You cannot deduct expenses for attending a convention, seminar, or similar meeting held outside the North American area unless: The meeting is directly related to your trade or business, and It is reasonable to hold the meeting outside the North American area. Free 2011 tax software See Reasonableness test , later. Free 2011 tax software If the meeting meets these requirements, you also must satisfy the rules for deducting expenses for business trips in general, discussed earlier under Travel Outside the United States . Free 2011 tax software North American area. Free 2011 tax software   The North American area includes the following locations. Free 2011 tax software American Samoa Johnston Island Antigua and Barbuda Kingman Reef Aruba Marshall Islands Bahamas Mexico Baker Island Micronesia Barbados Midway Islands Bermuda Netherlands Antilles Canada Northern Mariana Costa Rica Islands Dominica Palau Dominican Republic Palmyra Atoll Grenada Panama Guam Puerto Rico Guyana Trinidad and Tobago Honduras USA Howland Island U. Free 2011 tax software S. Free 2011 tax software Virgin Islands Jamaica Wake Island Jarvis Island   The North American area also includes U. Free 2011 tax software S. Free 2011 tax software islands, cays, and reefs that are possessions of the United States and not part of the fifty states or the District of Columbia. Free 2011 tax software Reasonableness test. Free 2011 tax software   The following factors are taken into account to determine if it was reasonable to hold the meeting outside the North American area. Free 2011 tax software The purpose of the meeting and the activities taking place at the meeting. Free 2011 tax software The purposes and activities of the sponsoring organizations or groups. Free 2011 tax software The homes of the active members of the sponsoring organizations and the places at which other meetings of the sponsoring organizations or groups have been or will be held. Free 2011 tax software Other relevant factors you may present. Free 2011 tax software Cruise Ships You can deduct up to $2,000 per year of your expenses of attending conventions, seminars, or similar meetings held on cruise ships. Free 2011 tax software All ships that sail are considered cruise ships. Free 2011 tax software You can deduct these expenses only if all of the following requirements are met. Free 2011 tax software The convention, seminar, or meeting is directly related to your trade or business. Free 2011 tax software The cruise ship is a vessel registered in the United States. Free 2011 tax software All of the cruise ship's ports of call are in the United States or in possessions of the United States. Free 2011 tax software You attach to your return a written statement signed by you that includes information about: The total days of the trip (not including the days of transportation to and from the cruise ship port), The number of hours each day that you devoted to scheduled business activities, and A program of the scheduled business activities of the meeting. Free 2011 tax software You attach to your return a written statement signed by an officer of the organization or group sponsoring the meeting that includes: A schedule of the business activities of each day of the meeting, and The number of hours you attended the scheduled business activities. Free 2011 tax software Prev  Up  Next   Home   More Online Publications