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Free Efile Of State Taxes

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Free Efile Of State Taxes

Free efile of state taxes Index A Assistance (see Tax help) C Carryback period, When To Use an NOL Carryback, waiving, Waiving the Carryback Period Carryforward period, When To Use an NOL Carryover from 2012 to 2013 Estates and trusts, Estates and trusts. Free efile of state taxes Worksheet instructions, Worksheet Instructions Claiming an NOL deduction, How To Claim an NOL Deduction D Deducting a carryback, Deducting a Carryback Deducting a carryforward, Deducting a Carryforward Domestic production activities deduction, Domestic production activities deduction (line 23). Free efile of state taxes , Modified taxable income. Free efile of state taxes E Eligible loss, Eligible loss. Free efile of state taxes F Farming business, Farming business. Free efile of state taxes Farming loss, Farming loss. Free efile of state taxes Figuring an NOL Capital losses, Adjustments for capital losses (lines 19–22). Free efile of state taxes Carryover, How To Figure an NOL Carryover Form 1045, Schedule A, Form 1045, Schedule A. Free efile of state taxes NOL deduction, NOLs from other years (line 24). Free efile of state taxes Nonbusiness deductions, Nonbusiness deductions (line 6). Free efile of state taxes Nonbusiness income, Nonbusiness income (line 7). Free efile of state taxes Filing status, change in, Change in Filing Status Form 1045, Schedule A, Form 1045, Schedule A. Free efile of state taxes Form 1045, Schedule B, Form 1045, Schedule B. Free efile of state taxes Forms and schedules Form 1040X, Form 1040X. Free efile of state taxes Form 1045, Form 1045. Free efile of state taxes Form 1045, Schedule A, Form 1045, Schedule A. Free efile of state taxes Form 1045, Schedule B, Form 1045, Schedule B. Free efile of state taxes Free tax services, Free help with your tax return. Free efile of state taxes Future developments, Reminders H Help (see Tax help) How to carry an NOL back or forward, How To Carry an NOL Back or Forward How to figure an NOL, How To Figure an NOL I Illustrated forms and schedules Form 1045, Illustrated Form 1045 Form 1045, Schedule A, Illustrated Form 1045, Schedule A Form 1045, Schedule B, Form 1045, Schedule B. Free efile of state taxes M Marital status, change in, Change in Marital Status Missing children, photographs of, Reminders Modified taxable income, Modified taxable income. Free efile of state taxes N NOL resulting in no taxable income, NOL resulting in no taxable income. Free efile of state taxes NOL year, Introduction, NOL year. Free efile of state taxes P Publications (see Tax help) Q Qualified disaster loss, Qualified disaster loss. Free efile of state taxes Qualified small business, Qualified small business. Free efile of state taxes R Refiguring tax, Refiguring your tax. Free efile of state taxes S Specified liability loss, Specified liability loss. Free efile of state taxes Steps in figuring NOL, NOL Steps T Tax help, How To Get Tax Help W Waiving the 10-year carryback, Waiving the 10-year carryback. Free efile of state taxes Waiving the 5-year carryback, Waiving the 5-year carryback. Free efile of state taxes Waiving the carryback period, Waiving the Carryback Period When to use an NOL, When To Use an NOL Worksheet (Continued), Carryover from 2012 to 2013, Prev  Up     Home   More Online Publications
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The Free Efile Of State Taxes

Free efile of state taxes 26. Free efile of state taxes   Car Expenses and Other Employee Business Expenses Table of Contents What's New Introduction Useful Items - You may want to see: Travel ExpensesTraveling Away From Home Tax Home Temporary Assignment or Job What Travel Expenses Are Deductible? Travel in the United States Travel Outside the United States Conventions Entertainment Expenses50% Limit What Entertainment Expenses Are Deductible? What Entertainment Expenses Are Not Deductible? Gift Expenses Transportation ExpensesArmed Forces reservists. Free efile of state taxes Parking fees. Free efile of state taxes Advertising display on car. Free efile of state taxes Car pools. Free efile of state taxes Hauling tools or instruments. Free efile of state taxes Union members' trips from a union hall. Free efile of state taxes Car Expenses RecordkeepingHow To Prove Expenses How Long To Keep Records and Receipts How To ReportGifts. Free efile of state taxes Statutory employees. Free efile of state taxes Reimbursements Completing Forms 2106 and 2106-EZ Special Rules What's New Standard mileage rate. Free efile of state taxes  For 2013, the standard mileage rate for the cost of operating your car for business use is 56½ cents per mile. Free efile of state taxes Car expenses and use of the standard mileage rate are explained under Transportation Expenses , later. Free efile of state taxes Depreciation limits on cars, trucks, and vans. Free efile of state taxes  For 2013, the first-year limit on the total section 179 deduction, special depreciation allowance, and depreciation deduction for cars remains at $11,160 ($3,160 if you elect not to claim the special depreciation allowance). Free efile of state taxes For trucks and vans the first-year limit remains at $11,360 ($3,360 if you elect not to claim the special depreciation allowance). Free efile of state taxes For more information, see Depreciation limits in Publication 463. Free efile of state taxes Introduction You may be able to deduct the ordinary and necessary business-related expenses you have for: Travel, Entertainment, Gifts, or Transportation. Free efile of state taxes An ordinary expense is one that is common and accepted in your trade or business. Free efile of state taxes A necessary expense is one that is helpful and appropriate for your business. Free efile of state taxes An expense does not have to be required to be considered necessary. Free efile of state taxes This chapter explains the following. Free efile of state taxes What expenses are deductible. Free efile of state taxes How to report your expenses on your return. Free efile of state taxes What records you need to prove your expenses. Free efile of state taxes How to treat any expense reimbursements you may receive. Free efile of state taxes Who does not need to use this chapter. Free efile of state taxes   If you are an employee, you will not need to read this chapter if all of the following are true. Free efile of state taxes You fully accounted to your employer for your work-related expenses. Free efile of state taxes You received full reimbursement for your expenses. Free efile of state taxes Your employer required you to return any excess reimbursement and you did so. Free efile of state taxes There is no amount shown with a code “L” in box 12 of your Form W-2, Wage and Tax Statement. Free efile of state taxes If you meet all of these conditions, there is no need to show the expenses or the reimbursements on your return. Free efile of state taxes See Reimbursements , later, if you would like more information on reimbursements and accounting to your employer. Free efile of state taxes    If you meet these conditions and your employer included reimbursements on your Form W-2 in error, ask your employer for a corrected Form W-2. Free efile of state taxes Useful Items - You may want to see: Publication 463 Travel, Entertainment, Gift, and Car Expenses 535 Business Expenses Form (and Instructions) Schedule A (Form 1040) Itemized Deductions Schedule C (Form 1040) Profit or Loss From Business Schedule C-EZ (Form 1040) Net Profit From Business Schedule F (Form 1040) Profit or Loss From Farming Form 2106 Employee Business Expenses Form 2106-EZ Unreimbursed Employee Business Expenses Travel Expenses If you temporarily travel away from your tax home, you can use this section to determine if you have deductible travel expenses. Free efile of state taxes This section discusses: Traveling away from home, Tax home, Temporary assignment or job, and What travel expenses are deductible. Free efile of state taxes It also discusses the standard meal allowance, rules for travel inside and outside the United States, and deductible convention expenses. Free efile of state taxes Travel expenses defined. Free efile of state taxes   For tax purposes, travel expenses are the ordinary and necessary expenses (defined earlier) of traveling away from home for your business, profession, or job. Free efile of state taxes   You will find examples of deductible travel expenses in Table 26-1 . Free efile of state taxes 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 efile of state taxes This rest requirement is not satisfied by merely napping in your car. Free efile of state taxes 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 efile of state taxes Example 1. Free efile of state taxes You are a railroad conductor. Free efile of state taxes You leave your home terminal on a regularly scheduled round-trip run between two cities and return home 16 hours later. Free efile of state taxes 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 efile of state taxes You are considered to be away from home. Free efile of state taxes Example 2. Free efile of state taxes You are a truck driver. Free efile of state taxes You leave your terminal and return to it later the same day. Free efile of state taxes You get an hour off at your turnaround point to eat. Free efile of state taxes 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 efile of state taxes Members of the Armed Forces. Free efile of state taxes   If you are a member of the U. Free efile of state taxes S. Free efile of state taxes Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. Free efile of state taxes You cannot deduct your expenses for meals and lodging. Free efile of state taxes 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 efile of state taxes 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 efile of state taxes    A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a tax home aboard ship for travel expense purposes. Free efile of state taxes Tax Home To determine whether you are traveling away from home, you must first determine the location of your tax home. Free efile of state taxes Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. Free efile of state taxes It includes the entire city or general area in which your business or work is located. Free efile of state taxes If you have more than one regular place of business, your tax home is your main place of business. Free efile of state taxes See Main place of business or work , later. Free efile of state taxes 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 efile of state taxes See No main place of business or work , later. Free efile of state taxes If you do not have a regular or a 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 efile of state taxes As an itinerant, you cannot claim a travel expense deduction because you are never considered to be traveling away from home. Free efile of state taxes Main place of business or work. Free efile of state taxes   If you have more than one place of business or work, consider the following when determining which one is your main place of business or work. Free efile of state taxes The total time you ordinarily spend in each place. Free efile of state taxes The level of your business activity in each place. Free efile of state taxes Whether your income from each place is significant or insignificant. Free efile of state taxes Example. Free efile of state taxes You live in Cincinnati where you have a seasonal job for 8 months each year and earn $40,000. Free efile of state taxes You work the other 4 months in Miami, also at a seasonal job, and earn $15,000. Free efile of state taxes Cincinnati is your main place of work because you spend most of your time there and earn most of your income there. Free efile of state taxes No main place of business or work. Free efile of state taxes   You may have a tax home even if you do not have a regular or main place of business or work. Free efile of state taxes Your tax home may be the home where you regularly live. Free efile of state taxes Factors used to determine tax home. Free efile of state taxes   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 efile of state taxes 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 efile of state taxes You have living expenses at your main home that you duplicate because your business requires you to be away from that home. Free efile of state taxes 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 efile of state taxes   If you satisfy all three factors, your tax home is the home where you regularly live. Free efile of state taxes If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. Free efile of state taxes If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses. Free efile of state taxes Example. Free efile of state taxes You are single and live in Boston in an apartment you rent. Free efile of state taxes You have worked for your employer in Boston for a number of years. Free efile of state taxes Your employer enrolls you in a 12-month executive training program. Free efile of state taxes You do not expect to return to work in Boston after you complete your training. Free efile of state taxes During your training, you do not do any work in Boston. Free efile of state taxes Instead, you receive classroom and on-the-job training throughout the United States. Free efile of state taxes You keep your apartment in Boston and return to it frequently. Free efile of state taxes You use your apartment to conduct your personal business. Free efile of state taxes You also keep up your community contacts in Boston. Free efile of state taxes When you complete your training, you are transferred to Los Angeles. Free efile of state taxes You do not satisfy factor (1) because you did not work in Boston. Free efile of state taxes You satisfy factor (2) because you had duplicate living expenses. Free efile of state taxes 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 efile of state taxes Therefore, you have a tax home in Boston. Free efile of state taxes Tax home different from family home. Free efile of state taxes   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 efile of state taxes You also cannot deduct the cost of meals and lodging while at your tax home. Free efile of state taxes See Example 1 . Free efile of state taxes   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 efile of state taxes See Example 2 . Free efile of state taxes Example 1. Free efile of state taxes You are a truck driver and you and your family live in Tucson. Free efile of state taxes You are employed by a trucking firm that has its terminal in Phoenix. Free efile of state taxes At the end of your long runs, you return to your home terminal in Phoenix and spend one night there before returning home. Free efile of state taxes You cannot deduct any expenses you have for meals and lodging in Phoenix or the cost of traveling from Phoenix to Tucson. Free efile of state taxes This is because Phoenix is your tax home. Free efile of state taxes Example 2. Free efile of state taxes Your family home is in Pittsburgh, where you work 12 weeks a year. Free efile of state taxes The rest of the year you work for the same employer in Baltimore. Free efile of state taxes In Baltimore, you eat in restaurants and sleep in a rooming house. Free efile of state taxes Your salary is the same whether you are in Pittsburgh or Baltimore. Free efile of state taxes Because you spend most of your working time and earn most of your salary in Baltimore, that city is your tax home. Free efile of state taxes You cannot deduct any expenses you have for meals and lodging there. Free efile of state taxes However, when you return to work in Pittsburgh, you are away from your tax home even though you stay at your family home. Free efile of state taxes You can deduct the cost of your round trip between Baltimore and Pittsburgh. Free efile of state taxes 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 efile of state taxes Temporary Assignment or Job You may regularly work at your tax home and also work at another location. Free efile of state taxes It may not be practical to return to your tax home from this other location at the end of each work day. Free efile of state taxes Temporary assignment vs. Free efile of state taxes indefinite assignment. Free efile of state taxes   If your assignment or job away from your main place of work is temporary, your tax home does not change. Free efile of state taxes You are considered to be away from home for the whole period you are away from your main place of work. Free efile of state taxes You can deduct your travel expenses if they otherwise qualify for deduction. Free efile of state taxes 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 efile of state taxes   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 efile of state taxes 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 efile of state taxes   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 efile of state taxes You may be able to deduct the cost of relocating to your new tax home as a moving expense. Free efile of state taxes See Publication 521 for more information. Free efile of state taxes Exception for federal crime investigations or prosecutions. Free efile of state taxes   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule. Free efile of state taxes 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 efile of state taxes   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 or prosecute, or provide support services for the investigation or prosecution of a federal crime. Free efile of state taxes Determining temporary or indefinite. Free efile of state taxes   You must determine whether your assignment is temporary or indefinite when you start work. Free efile of state taxes 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 efile of state taxes An assignment or job that is initially temporary may become indefinite due to changed circumstances. Free efile of state taxes 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 efile of state taxes Going home on days off. Free efile of state taxes   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 efile of state taxes You cannot deduct the cost of your meals and lodging there. Free efile of state taxes However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home. Free efile of state taxes You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. Free efile of state taxes   If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. Free efile of state taxes 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 efile of state taxes Probationary work period. Free efile of state taxes   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 efile of state taxes You cannot deduct any of your expenses for meals and lodging during the probationary period. Free efile of state taxes 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 efile of state taxes You can deduct ordinary and necessary expenses you have when you travel away from home on business. Free efile of state taxes The type of expense you can deduct depends on the facts and your circumstances. Free efile of state taxes Table 26-1 summarizes travel expenses you may be able to deduct. Free efile of state taxes You may have other deductible travel expenses that are not covered there, depending on the facts and your circumstances. Free efile of state taxes 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 efile of state taxes You can use a log, diary, notebook, or any other written record to keep track of your expenses. Free efile of state taxes The types of expenses you need to record, along with supporting documentation, are described in Table 26-2 , later. Free efile of state taxes Separating costs. Free efile of state taxes   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 efile of state taxes You must have a reasonable basis for making this allocation. Free efile of state taxes For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. Free efile of state taxes Travel expenses for another individual. Free efile of state taxes   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 efile of state taxes Employee. Free efile of state taxes   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 efile of state taxes Business associate. Free efile of state taxes   If a business associate travels with you and meets the conditions in (2) and (3) above, you can deduct the travel expenses you have for that person. Free efile of state taxes A business associate is someone with whom you could reasonably expect to engage or deal in the active conduct of your business. Free efile of state taxes A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor. Free efile of state taxes Bona fide business purpose. Free efile of state taxes   A bona fide business purpose exists if you can prove a real business purpose for the individual's presence. Free efile of state taxes Incidental services, such as typing notes or assisting in entertaining customers, are not enough to make the expenses deductible. Free efile of state taxes Example. Free efile of state taxes Jerry drives to Chicago on business and takes his wife, Linda, with him. Free efile of state taxes Linda is not Jerry's employee. Free efile of state taxes Linda occasionally types notes, performs similar services, and accompanies Jerry to luncheons and dinners. Free efile of state taxes The performance of these services does not establish that her presence on the trip is necessary to the conduct of Jerry's business. Free efile of state taxes Her expenses are not deductible. Free efile of state taxes Jerry pays $199 a day for a double room. Free efile of state taxes A single room costs $149 a day. Free efile of state taxes He can deduct the total cost of driving his car to and from Chicago, but only $149 a day for his hotel room. Free efile of state taxes If he uses public transportation, he can deduct only his fare. Free efile of state taxes Table 26-1. Free efile of state taxes Travel Expenses You Can Deduct This chart summarizes expenses you can deduct when you travel away from home for business purposes. Free efile of state taxes IF you have expenses for. Free efile of state taxes . Free efile of state taxes . Free efile of state taxes THEN you can deduct the cost of. Free efile of state taxes . Free efile of state taxes . Free efile of state taxes transportation travel by airplane, train, bus, or car between your home and your business destination. Free efile of state taxes If you were provided with a ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero. Free efile of state taxes If you travel by ship, see Luxury Water Travel and Cruise ships (under Conventions) in Publication 463 for additional rules and limits. Free efile of state taxes 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 efile of state taxes baggage and shipping sending baggage and sample or display material between your regular and temporary work locations. Free efile of state taxes car operating and maintaining your car when traveling away from home on business. Free efile of state taxes You can deduct actual expenses or the standard mileage rate as well as business-related tolls and parking. Free efile of state taxes If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Free efile of state taxes 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 efile of state taxes Meals include amounts spent for food, beverages, taxes, and related tips. Free efile of state taxes See Meals and Incidental Expenses for additional rules and limits. Free efile of state taxes cleaning dry cleaning and laundry. Free efile of state taxes telephone business calls while on your business trip. Free efile of state taxes This includes business communication by fax machine or other communication devices. Free efile of state taxes tips tips you pay for any expenses in this chart. Free efile of state taxes other other similar ordinary and necessary expenses related to your business travel. Free efile of state taxes 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 efile of state taxes Meals and Incidental Expenses You can deduct the cost of meals in either of the following situations. Free efile of state taxes 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 efile of state taxes The meal is business-related entertainment. Free efile of state taxes Business-related entertainment is discussed under Entertainment Expenses , later. Free efile of state taxes The following discussion deals only with meals (and incidental expenses) that are not business-related entertainment. Free efile of state taxes Lavish or extravagant. Free efile of state taxes   You cannot deduct expenses for meals that are lavish or extravagant. Free efile of state taxes An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. Free efile of state taxes 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 efile of state taxes 50% limit on meals. Free efile of state taxes   You can figure your meal expenses using either of the following methods. Free efile of state taxes Actual cost. Free efile of state taxes The standard meal allowance. Free efile of state taxes Both of these methods are explained below. Free efile of state taxes But, regardless of the method you use, you generally can deduct only 50% of the unreimbursed cost of your meals. Free efile of state taxes   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 efile of state taxes If you are not reimbursed, the 50% limit applies whether the unreimbursed meal expense is for business travel or business entertainment. Free efile of state taxes The 50% limit is explained later under Entertainment Expenses . Free efile of state taxes Accountable and nonaccountable plans are discussed later under Reimbursements . Free efile of state taxes Actual cost. Free efile of state taxes   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 efile of state taxes If you use this method, you must keep records of your actual cost. Free efile of state taxes Standard meal allowance. Free efile of state taxes   Generally, you can use the “standard meal allowance” method as an alternative to the actual cost method. Free efile of state taxes 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 efile of state taxes The set amount varies depending on where and when you travel. Free efile of state taxes In this chapter, “standard meal allowance” refers to the federal rate for M&IE, discussed later under Amount of standard meal allowance . Free efile of state taxes If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel. Free efile of state taxes See Recordkeeping , later. Free efile of state taxes Incidental expenses. Free efile of state taxes   The term “incidental expenses” means fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. Free efile of state taxes 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 efile of state taxes Incidental expenses only method. Free efile of state taxes   You can use an optional method (instead of actual cost) for deducting incidental expenses only. Free efile of state taxes The amount of the deduction is $5 a day. Free efile of state taxes You can use this method only if you did not pay or incur any meal expenses. Free efile of state taxes You cannot use this method on any day that you use the standard meal allowance. Free efile of state taxes    Federal employees should refer to the Federal Travel Regulations at  www. Free efile of state taxes gsa. Free efile of state taxes gov. Free efile of state taxes Find “What GSA Offers” and click on “Regulations: FMR, FTR, & FAR” for Federal Travel Regulation (FTR) for changes affecting claims for reimbursement. Free efile of state taxes 50% limit may apply. Free efile of state taxes   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 efile of state taxes 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 efile of state taxes The 50% limit is explained later under Entertainment Expenses . Free efile of state taxes Accountable and nonaccountable plans are discussed later under Reimbursements . Free efile of state taxes There is no optional standard lodging amount similar to the standard meal allowance. Free efile of state taxes Your allowable lodging expense deduction is your actual cost. Free efile of state taxes Who can use the standard meal allowance. Free efile of state taxes   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 efile of state taxes   Use of the standard meal allowance for other travel. Free efile of state taxes    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 efile of state taxes You can also use it to figure your meal expenses when you travel for qualifying educational purposes. Free efile of state taxes You cannot use the standard meal allowance to figure the cost of your meals when you travel for medical or charitable purposes. Free efile of state taxes Amount of standard meal allowance. Free efile of state taxes   The standard meal allowance is the federal M&IE rate. Free efile of state taxes For travel in 2013, the daily rate for most small localities in the United States is $46. Free efile of state taxes   Most major cities and many other localities in the United States are designated as high-cost areas, qualifying for higher standard meal allowances. Free efile of state taxes You can find this information (organized by state) on the Internet at www. Free efile of state taxes gsa. Free efile of state taxes gov. Free efile of state taxes Click on “Per Diem Rates,” then select “2013” for the period January 1, 2013 – September 30, 2013, and select “2014” for the period October 1, 2013 – December 31, 2013. Free efile of state taxes However, you can apply the rates in effect before October 1, 2013, for expenses of all travel within the United States for 2013 instead of the updated rates. Free efile of state taxes You must consistently use either the rates for the first 9 months for all of 2013 or the updated rates for the period of October 1, 2013, through December 31, 2013. Free efile of state taxes   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 efile of state taxes If you work in the transportation industry, however, see Special rate for transportation workers , later. Free efile of state taxes Standard meal allowance for areas outside the continental United States. Free efile of state taxes    The standard meal allowance rates above do not apply to travel in Alaska, Hawaii, or any other location outside the continental United States. Free efile of state taxes The Department of Defense establishes per diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U. Free efile of state taxes S. Free efile of state taxes Virgin Islands, Wake Island, and other non-foreign areas outside the continental United States. Free efile of state taxes The Department of State establishes per diem rates for all other foreign areas. Free efile of state taxes    You can access per diem rates for non-foreign areas outside the continental United States at: www. Free efile of state taxes defensetravel. Free efile of state taxes dod. Free efile of state taxes mil/site/perdiemCalc. Free efile of state taxes cfm. Free efile of state taxes You can access all other foreign per diem rates at www. Free efile of state taxes state. Free efile of state taxes gov/travel/. Free efile of state taxes Click on “Travel Per Diem Allowances for Foreign Areas” under “Foreign Per Diem Rates,” to obtain the latest foreign per diem rates. Free efile of state taxes Special rate for transportation workers. Free efile of state taxes   You can use a special standard meal allowance if you work in the transportation industry. Free efile of state taxes 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 efile of state taxes If this applies to you, you can claim a standard daily meal allowance of $59 ($65 for travel outside the continental United States). Free efile of state taxes   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 efile of state taxes 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 efile of state taxes Travel for days you depart and return. Free efile of state taxes   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 efile of state taxes You can do so by one of two methods. Free efile of state taxes Method 1: You can claim 3/4 of the standard meal allowance. Free efile of state taxes Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice. Free efile of state taxes Example. Free efile of state taxes Jen is employed in New Orleans as a convention planner. Free efile of state taxes In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. Free efile of state taxes She left her home in New Orleans at 10 a. Free efile of state taxes m. Free efile of state taxes on Wednesday and arrived in Washington, DC, at 5:30 p. Free efile of state taxes m. Free efile of state taxes After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p. Free efile of state taxes m. Free efile of state taxes Jen's employer gave her a flat amount to cover her expenses and included it with her wages. Free efile of state taxes 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 efile of state taxes Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. Free efile of state taxes 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 efile of state taxes Travel in the United States The following discussion applies to travel in the United States. Free efile of state taxes For this purpose, the United States includes only the 50 states and the District of Columbia. Free efile of state taxes 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 efile of state taxes See Part of Trip Outside the United States , later. Free efile of state taxes Trip Primarily for Business You can deduct all your travel expenses if your trip was entirely business related. Free efile of state taxes 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 your business-related travel expenses. Free efile of state taxes These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination. Free efile of state taxes Example. Free efile of state taxes You work in Atlanta and take a business trip to New Orleans in May. Free efile of state taxes On your way home, you stop in Mobile to visit your parents. Free efile of state taxes You spend $1,996 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. Free efile of state taxes If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,696. Free efile of state taxes You can deduct $1,696 for your trip, including the cost of round-trip transportation to and from New Orleans. Free efile of state taxes The deduction for your meals is subject to the 50% limit on meals mentioned earlier. Free efile of state taxes 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 efile of state taxes However, you can deduct any expenses you have while at your destination that are directly related to your business. Free efile of state taxes 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 efile of state taxes 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 efile of state taxes Part of Trip Outside the United States If part of your trip is outside the United States, use the rules described later under Travel Outside the United States for that part of the trip. Free efile of state taxes For the part of your trip that is inside the United States, use the rules for travel in the United States. Free efile of state taxes Travel outside the United States does not include travel from one point in the United States to another point in the United States. Free efile of state taxes The following discussion can help you determine whether your trip was entirely within the United States. Free efile of state taxes Public transportation. Free efile of state taxes   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 efile of state taxes 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 efile of state taxes Example. Free efile of state taxes You fly from New York to Puerto Rico with a scheduled stop in Miami. Free efile of state taxes You return to New York nonstop. Free efile of state taxes 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 efile of state taxes Because there are no scheduled stops between Puerto Rico and New York, all of the return trip is outside the United States. Free efile of state taxes Private car. Free efile of state taxes   Travel by private car in the United States is travel between points in the United States, even when you are on your way to a destination outside the United States. Free efile of state taxes Example. Free efile of state taxes You travel by car from Denver to Mexico City and return. Free efile of state taxes 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 efile of state taxes The rules under Travel Outside the United States apply to your trip from the border to Mexico City and back to the border. Free efile of state taxes 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 efile of state taxes For this purpose, the United States includes only the 50 states and the District of Columbia. Free efile of state taxes 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 efile of state taxes See chapter 1 of Publication 463 for information on luxury water travel. Free efile of state taxes 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 efile of state taxes Travel entirely for business. Free efile of state taxes   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 efile of state taxes Travel considered entirely for business. Free efile of state taxes   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 efile of state taxes Exception 1 - No substantial control. Free efile of state taxes   Your trip is considered entirely for business if you did not have substantial control over arranging the trip. Free efile of state taxes 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 efile of state taxes   You do not have substantial control over your trip if you: Are an employee who was reimbursed or paid a travel expense allowance, Are not related to your employer, and Are not a managing executive. Free efile of state taxes    “Related to your employer” is defined later in this chapter under Per Diem and Car Allowances . Free efile of state taxes   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 efile of state taxes    A self-employed person generally has substantial control over arranging business trips. Free efile of state taxes Exception 2 - Outside United States no more than a week. Free efile of state taxes   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 efile of state taxes One week means 7 consecutive days. Free efile of state taxes 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 efile of state taxes Exception 3 - Less than 25% of time on personal activities. Free efile of state taxes   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 efile of state taxes For this purpose, count both the day your trip began and the day it ended. Free efile of state taxes Exception 4 - Vacation not a major consideration. Free efile of state taxes   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 efile of state taxes Travel Primarily for Business If you travel outside the United States primarily for business but spend some of your time on nonbusiness activities, you generally cannot deduct all of your travel expenses. Free efile of state taxes You can only deduct the business portion of your cost of getting to and from your destination. Free efile of state taxes You must allocate the costs between your business and nonbusiness activities to determine your deductible amount. Free efile of state taxes These travel allocation rules are discussed in chapter 1 of Publication 463. Free efile of state taxes You do not have to allocate your travel expense deduction if you meet one of the four exceptions listed earlier under Travel considered entirely for business. Free efile of state taxes In those cases, you can deduct the total cost of getting to and from your destination. Free efile of state taxes 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 efile of state taxes 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 efile of state taxes 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 efile of state taxes You cannot deduct the travel expenses for your family. Free efile of state taxes If the convention is for investment, political, social, or other purposes unrelated to your trade or business, you cannot deduct the expenses. Free efile of state taxes Your appointment or election as a delegate does not, in itself, determine whether you can deduct travel expenses. Free efile of state taxes You can deduct your travel expenses only if your attendance is connected to your own trade or business. Free efile of state taxes Convention agenda. Free efile of state taxes   The convention agenda or program generally shows the purpose of the convention. Free efile of state taxes 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 efile of state taxes 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 efile of state taxes Conventions held outside the North American area. Free efile of state taxes    See chapter 1 of Publication 463 for information on conventions held outside the North American area. Free efile of state taxes Entertainment Expenses You may be able to deduct business-related entertainment expenses you have for entertaining a client, customer, or employee. Free efile of state taxes You can deduct entertainment expenses only if they are both ordinary and necessary (defined earlier in the Introduction ) and meet one of the following tests. Free efile of state taxes Directly-related test. Free efile of state taxes Associated test. Free efile of state taxes Both of these tests are explained in chapter 2 of Publication 463. Free efile of state taxes The amount you can deduct for entertainment expenses may be limited. Free efile of state taxes Generally, you can deduct only 50% of your unreimbursed entertainment expenses. Free efile of state taxes This limit is discussed next. Free efile of state taxes 50% Limit In general, you can deduct only 50% of your business-related meal and entertainment expenses. Free efile of state taxes (If you are subject to the Department of Transportation's “hours of service” limits, you can deduct 80% of your business-related meal and entertainment expenses. Free efile of state taxes See Individuals subject to “hours of service” limits , later. Free efile of state taxes ) The 50% limit applies to employees or their employers, and to self-employed persons (including independent contractors) or their clients, depending on whether the expenses are reimbursed. Free efile of state taxes Figure 26-A summarizes the general rules explained in this section. Free efile of state taxes The 50% limit applies to business meals or entertainment expenses you have while: Traveling away from home (whether eating alone or with others) on business, Entertaining customers at your place of business, a restaurant, or other location, or Attending a business convention or reception, business meeting, or business luncheon at a club. Free efile of state taxes Included expenses. Free efile of state taxes   Expenses subject to the 50% limit include: Taxes and tips relating to a business meal or entertainment activity, Cover charges for admission to a nightclub, Rent paid for a room in which you hold a dinner or cocktail party, and Amounts paid for parking at a sports arena. Free efile of state taxes However, the cost of transportation to and from a business meal or a business-related entertainment activity is not subject to the 50% limit. Free efile of state taxes Application of 50% limit. Free efile of state taxes   The 50% limit on meal and entertainment expenses applies if the expense is otherwise deductible and is not covered by one of the exceptions discussed later in this section. Free efile of state taxes   The 50% limit also applies to certain meal and entertainment expenses that are not business related. Free efile of state taxes It applies to meal and entertainment expenses incurred for the production of income, including rental or royalty income. Free efile of state taxes It also applies to the cost of meals included in deductible educational expenses. Free efile of state taxes When to apply the 50% limit. Free efile of state taxes   You apply the 50% limit after determining the amount that would otherwise qualify for a deduction. Free efile of state taxes You first have to determine the amount of meal and entertainment expenses that would be deductible under the other rules discussed in this chapter. Free efile of state taxes Example 1. Free efile of state taxes You spend $200 for a business-related meal. Free efile of state taxes If $110 of that amount is not allowable because it is lavish and extravagant, the remaining $90 is subject to the 50% limit. Free efile of state taxes Your deduction cannot be more than $45 (. Free efile of state taxes 50 × $90). Free efile of state taxes Example 2. Free efile of state taxes You purchase two tickets to a concert and give them to a client. Free efile of state taxes You purchased the tickets through a ticket agent. Free efile of state taxes You paid $200 for the two tickets, which had a face value of $80 each ($160 total). Free efile of state taxes Your deduction cannot be more than $80 (. Free efile of state taxes 50 × $160). Free efile of state taxes Exceptions to the 50% Limit Generally, business-related meal and entertainment expenses are subject to the 50% limit. Free efile of state taxes Figure 26-A can help you determine if the 50% limit applies to you. Free efile of state taxes Your meal or entertainment expense is not subject to the 50% limit if the expense meets one of the following exceptions. Free efile of state taxes Employee's reimbursed expenses. Free efile of state taxes   If you are an employee, you are not subject to the 50% limit on expenses for which your employer reimburses you under an accountable plan. Free efile of state taxes Accountable plans are discussed later under Reimbursements . Free efile of state taxes Individuals subject to “hours of service” limits. Free efile of state taxes   You can deduct a higher percentage of your meal expenses while traveling away from your tax home if the meals take place during or incident to any period subject to the Department of Transportation's “hours of service” limits. Free efile of state taxes The percentage is 80%. Free efile of state taxes   Individuals subject to the Department of Transportation's “hours of service” limits include the following persons. Free efile of state taxes Certain air transportation workers (such as pilots, crew, dispatchers, mechanics, and control tower operators) who are under Federal Aviation Administration regulations. Free efile of state taxes Interstate truck operators and bus drivers who are under Department of Transportation regulations. Free efile of state taxes Certain railroad employees (such as engineers, conductors, train crews, dispatchers, and control operations personnel) who are under Federal Railroad Administration regulations. Free efile of state taxes Certain merchant mariners who are under Coast Guard regulations. Free efile of state taxes Other exceptions. Free efile of state taxes   There are also exceptions for the self-employed, advertising expenses, selling meals or entertainment, and charitable sports events. Free efile of state taxes These are discussed in Publication 463. Free efile of state taxes Figure 26-A. Free efile of state taxes Does the 50% Limit Apply to Your Expenses? There are exceptions to these rules. Free efile of state taxes See Exceptions to the 50% Limit . Free efile of state taxes Please click here for the text description of the image. Free efile of state taxes Entertainment expenses: 50% limit What Entertainment Expenses Are Deductible? This section explains different types of entertainment expenses you may be able to deduct. Free efile of state taxes Entertainment. Free efile of state taxes    Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation. Free efile of state taxes Examples include entertaining guests at nightclubs; at social, athletic, and sporting clubs; at theaters; at sporting events; or on hunting, fishing, vacation, and similar trips. Free efile of state taxes A meal as a form of entertainment. Free efile of state taxes   Entertainment includes the cost of a meal you provide to a customer or client, whether the meal is a part of other entertainment or by itself. Free efile of state taxes A meal expense includes the cost of food, beverages, taxes, and tips for the meal. Free efile of state taxes To deduct an entertainment-related meal, you or your employee must be present when the food or beverages are provided. Free efile of state taxes You cannot claim the cost of your meal both as an entertainment expense and as a travel expense. Free efile of state taxes Separating costs. Free efile of state taxes   If you have one expense that includes the costs of entertainment and other services (such as lodging or transportation), you must allocate that expense between the cost of entertainment and the cost of other services. Free efile of state taxes You must have a reasonable basis for making this allocation. Free efile of state taxes For example, you must allocate your expenses if a hotel includes entertainment in its lounge on the same bill with your room charge. Free efile of state taxes Taking turns paying for meals or entertainment. Free efile of state taxes   If a group of business acquaintances take turns picking up each others' meal or entertainment checks without regard to whether any business purposes are served, no member of the group can deduct any part of the expense. Free efile of state taxes Lavish or extravagant expenses. Free efile of state taxes   You cannot deduct expenses for entertainment that are lavish or extravagant. Free efile of state taxes An expense is not considered lavish or extravagant if it is reasonable considering the facts and circumstances. Free efile of state taxes Expenses will not be disallowed just because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. Free efile of state taxes Trade association meetings. Free efile of state taxes    You can deduct entertainment expenses that are directly related to, and necessary for, attending business meetings or conventions of certain exempt organizations if the expenses of your attendance are related to your active trade or business. Free efile of state taxes These organizations include business leagues, chambers of commerce, real estate boards, trade associations, and professional associations. Free efile of state taxes Entertainment tickets. Free efile of state taxes   Generally, you cannot deduct more than the face value of an entertainment ticket, even if you paid a higher price. Free efile of state taxes For example, you cannot deduct service fees you pay to ticket agencies or brokers or any amount over the face value of the tickets you pay to scalpers. Free efile of state taxes What Entertainment Expenses Are Not Deductible? This section explains different types of entertainment expenses you generally may not be able to deduct. Free efile of state taxes Club dues and membership fees. Free efile of state taxes   You cannot deduct dues (including initiation fees) for membership in any club organized for: Business, Pleasure, Recreation, or Other social purpose. Free efile of state taxes This rule applies to any membership organization if one of its principal purposes is either: To conduct entertainment activities for members or their guests, or To provide members or their guests with access to entertainment facilities. Free efile of state taxes   The purposes and activities of a club, not its name, will determine whether or not you can deduct the dues. Free efile of state taxes You cannot deduct dues paid to: Country clubs, Golf and athletic clubs, Airline clubs, Hotel clubs, and Clubs operated to provide meals under circumstances generally considered to be conducive to business discussions. Free efile of state taxes Entertainment facilities. Free efile of state taxes   Generally, you cannot deduct any expense for the use of an entertainment facility. Free efile of state taxes This includes expenses for depreciation and operating costs such as rent, utilities, maintenance, and protection. Free efile of state taxes   An entertainment facility is any property you own, rent, or use for entertainment. Free efile of state taxes Examples include a yacht, hunting lodge, fishing camp, swimming pool, tennis court, bowling alley, car, airplane, apartment, hotel suite, or home in a vacation resort. Free efile of state taxes Out-of-pocket expenses. Free efile of state taxes   You can deduct out-of-pocket expenses, such as for food and beverages, catering, gas, and fishing bait, that you provided during entertainment at a facility. Free efile of state taxes These are not expenses for the use of an entertainment facility. Free efile of state taxes However, these expenses are subject to the directly-related and associated tests and to the 50% Limit discussed earlier. Free efile of state taxes Additional information. Free efile of state taxes   For more information on entertainment expenses, including discussions of the directly-related and associated tests, see chapter 2 of Publication 463. Free efile of state taxes Gift Expenses If you give gifts in the course of your trade or business, you can deduct all or part of the cost. Free efile of state taxes This section explains the limits and rules for deducting the costs of gifts. Free efile of state taxes $25 limit. Free efile of state taxes   You can deduct no more than $25 for business gifts you give directly or indirectly to each person during your tax year. Free efile of state taxes A gift to a company that is intended for the eventual personal use or benefit of a particular person or a limited class of people will be considered an indirect gift to that particular person or to the individuals within that class of people who receive the gift. Free efile of state taxes   If you give a gift to a member of a customer's family, the gift is generally considered to be an indirect gift to the customer. Free efile of state taxes This rule does not apply if you have a bona fide, independent business connection with that family member and the gift is not intended for the customer's eventual use or benefit. Free efile of state taxes   If you and your spouse both give gifts, both of you are treated as one taxpayer. Free efile of state taxes It does not matter whether you have separate businesses, are separately employed, or whether each of you has an independent connection with the recipient. Free efile of state taxes If a partnership gives gifts, the partnership and the partners are treated as one taxpayer. Free efile of state taxes Incidental costs. Free efile of state taxes   Incidental costs, such as engraving on jewelry, or packaging, insuring, and mailing, are generally not included in determining the cost of a gift for purposes of the $25 limit. Free efile of state taxes   A cost is incidental only if it does not add substantial value to the gift. Free efile of state taxes For example, the cost of customary gift wrapping is an incidental cost. Free efile of state taxes However, the purchase of an ornamental basket for packaging fruit is not an incidental cost if the value of the basket is substantial compared to the value of the fruit. Free efile of state taxes Exceptions. Free efile of state taxes   The following items are not considered gifts for purposes of the $25 limit. Free efile of state taxes An item that costs $4 or less and: Has your name clearly and permanently imprinted on the gift, and Is one of a number of identical items you widely distribute. Free efile of state taxes Examples include pens, desk sets, and plastic bags and cases. Free efile of state taxes Signs, display racks, or other promotional material to be used on the business premises of the recipient. Free efile of state taxes Gift or entertainment. Free efile of state taxes   Any item that might be considered either a gift or entertainment generally will be considered entertainment. Free efile of state taxes However, if you give a customer packaged food or beverages you intend the customer to use at a later date, treat it as a gift. Free efile of state taxes    If you give a customer tickets to a theater performance or sporting event and you do not go with the customer to the performance or event, you have a choice. Free efile of state taxes You can treat the cost of the tickets as either a gift expense or an entertainment expense, whichever is to your advantage. Free efile of state taxes    If you go with the customer to the event, you must treat the cost of the tickets as an entertainment expense. Free efile of state taxes You cannot choose, in this case, to treat the cost of the tickets as a gift expense. Free efile of state taxes Transportation Expenses This section discusses expenses you can deduct for business transportation when you are not traveling away from home as defined earlier under Travel Expenses . Free efile of state taxes These expenses include the cost of transportation by air, rail, bus, taxi, etc. Free efile of state taxes , and the cost of driving and maintaining your car. Free efile of state taxes Transportation expenses include the ordinary and necessary costs of all of the following. Free efile of state taxes Getting from one workplace to another in the course of your business or profession when you are traveling within the area of your tax home. Free efile of state taxes (Tax home is defined earlier under Travel Expenses . Free efile of state taxes ) Visiting clients or customers. Free efile of state taxes Going to a business meeting away from your regular workplace. Free efile of state taxes Getting from your home to a temporary workplace when you have one or more regular places of work. Free efile of state taxes These temporary workplaces can be either within the area of your tax home or outside that area. Free efile of state taxes Transportation expenses do not include expenses you have while traveling away from home overnight. Free efile of state taxes Those expenses are travel expenses, discussed earlier. Free efile of state taxes However, if you use your car while traveling away from home overnight, use the rules in this section to figure your car expense deduction. Free efile of state taxes See Car Expenses , later. Free efile of state taxes Illustration of transportation expenses. Free efile of state taxes    Figure 26-B illustrates the rules for when you can deduct transportation expenses when you have a regular or main job away from your home. Free efile of state taxes You may want to refer to it when deciding whether you can deduct your transportation expenses. Free efile of state taxes Daily transportation expenses you incur while traveling from home to one or more regular places of business are generally nondeductible commuting expenses. Free efile of state taxes However, there are many exceptions for deducting transportation expenses, like whether your work location is temporary (inside or outside the metropolitan area), traveling for same trade or business, or if you have a home office. Free efile of state taxes Temporary work location. Free efile of state taxes   If you have one or more regular work locations away from your home and you commute to a temporary work location in the same trade or business, you can deduct the expenses of the daily round-trip transportation between your home and the temporary location, regardless of distance. Free efile of state taxes   If your employment at a work location is realistically expected to last (and does in fact last) for 1 year or less, the employment is temporary unless there are facts and circumstances that would indicate otherwise. Free efile of state taxes   If your employment at a work location is realistically expected to last for more than 1 year or if there is no realistic expectation that the employment will last for 1 year or less, the employment is not temporary, regardless of whether it actually lasts for more than 1 year. Free efile of state taxes   If employment at a work location initially is realistically expected to last for 1 year or less, but at some later date the employment is realistically expected to last more than 1 year, that employment will be treated as temporary (unless there are facts and circumstances that would indicate otherwise) until your expectation changes. Free efile of state taxes It will not be treated as temporary after the date you determine it will last more than 1 year. Free efile of state taxes   If the temporary work location is beyond the general area of your regular place of work and you stay overnight, you are traveling away from home. Free efile of state taxes You may have deductible travel expenses as discussed earlier in this chapter. Free efile of state taxes No regular place of work. Free efile of state taxes   If you have no regular place of work but ordinarily work in the metropolitan area where you live, you can deduct daily transportation costs between home and a temporary work site outside that metropolitan area. Free efile of state taxes   Generally, a metropolitan area includes the area within the city limits and the suburbs that are considered part of that metropolitan area. Free efile of state taxes   You cannot deduct daily transportation costs between your home and temporary work sites within your metropolitan area. Free efile of state taxes These are nondeductible commuting expenses. Free efile of state taxes Two places of work. Free efile of state taxes   If you work at two places in one day, whether or not for the same employer, you can deduct the expense of getting from one workplace to the other. Free efile of state taxes However, if for some personal reason you do not go directly from one location to the other, you cannot deduct more than the amount it would have cost you to go directly from the first location to the second. Free efile of state taxes   Transportation expenses you have in going between home and a part-time job on a day off from your main job are commuting expenses. Free efile of state taxes You cannot deduct them. Free efile of state taxes Armed Forces reservists. Free efile of state taxes   A meeting of an Armed Forces reserve unit is a second place of business if the meeting is held on a day on which you work at your regular job. Free efile of state taxes You can deduct the expense of getting from one workplace to the other as just discussed under Two places of work , earlier. Free efile of state taxes   You usually cannot deduct the expense if the reserve meeting is held on a day on which you do not work at your regular job. Free efile of state taxes In this case, your transportation generally is a nondeductible commuting expense. Free efile of state taxes However, you can deduct your transportation expenses if the location of the meeting is temporary and you have one or more regular places of work. Free efile of state taxes   If you ordinarily work in a particular metropolitan area but not at any specific location and the reserve meeting is held at a temporary location outside that metropolitan area, you can deduct your transportation expenses. Free efile of state taxes   If you travel away from home overnight to attend a guard or reserve meeting, you can deduct your travel expenses. Free efile of state taxes These expenses are discussed earlier under Travel Expenses . Free efile of state taxes   If you travel more than 100 miles away from home in connection with your performance of services as a member of the reserves, you may be able to deduct some of your reserve-related travel costs as an adjustment to income rather than as an itemized deduction. Free efile of state taxes See Armed Forces reservists traveling more than 100 miles from home under Special Rules, later. Free efile of state taxes Commuting expenses. Free efile of state taxes   You cannot deduct the costs of taking a bus, trolley, subway, or taxi, or of driving a car between your home and your main or regular place of work. Free efile of state taxes These costs are personal commuting expenses. Free efile of state taxes You cannot deduct commuting expenses no matter how far your home is from your regular place of work. Free efile of state taxes You cannot deduct commuting expenses even if you work during the commuting trip. Free efile of state taxes Example. Free efile of state taxes You sometimes use your cell phone to make business calls while commuting to and from work. Free efile of state taxes Sometimes business associates ride with you to and from work, and you have a business discussion in the car. Free efile of state taxes These activities do not change the trip from personal to business. Free efile of state taxes You cannot deduct your commuting expenses. Free efile of state taxes Parking fees. Free efile of state taxes   Fees you pay to park your car at your place of business are nondeductible commuting expenses. Free efile of state taxes You can, however, deduct business-related parking fees when visiting a customer or client. Free efile of state taxes Advertising display on car. Free efile of state taxes   Putting display material that advertises your business on your car does not change the use of your car from personal use to business use. Free efile of state taxes If you use this car for commuting or other personal uses, you still cannot deduct your expenses for those uses. Free efile of state taxes Car pools. Free efile of state taxes   You cannot deduct the cost of using your car in a nonprofit car pool. Free efile of state taxes Do not include payments you receive from the passengers in your income. Free efile of state taxes These payments are considered reimbursements of your expenses. Free efile of state taxes However, if you operate a car pool for a profit, you must include payments from passengers in your income. Free efile of state taxes You can then deduct your car expenses (using the rules in this chapter). Free efile of state taxes Hauling tools or instruments. Free efile of state taxes   Hauling tools or instruments in your car while commuting to and from work does not make your car expenses deductible. Free efile of state taxes However, you can deduct any additional costs you have for hauling tools or instruments (such as for renting a trailer you tow with your car). Free efile of state taxes Union members' trips from a union hall. Free efile of state taxes   If you get your work assignments at a union hall and then go to your place of work, the costs of getting from the union hall to your place of work are nondeductible commuting expenses. Free efile of state taxes Although you need the union to get your work assignments, you are employed where you work, not where the union hall is located. Free efile of state taxes Office in the home. Free efile of state taxes   If you have an office in your home that qualifies as a principal place of business, you can deduct your daily transportation costs between your home and another work location in the same trade or business. Free efile of state taxes (See chapter 28 for information on determining if your home office qualifies as a principal place of business. Free efile of state taxes ) Figure 26-B. Free efile of state taxes When Are Transportation Expenses Deductible? Most employees and self-employed persons can use this chart. Free efile of state taxes (Do not use this chart if your home is your principal place of business. Free efile of state taxes See Office in the home . Free efile of state taxes ) Please click here for the text description of the image. Free efile of state taxes Figure 26-B. Free efile of state taxes Local Transportation Examples of deductible transportation. Free efile of state taxes   The following examples show when you can deduct transportation expenses based on the location of your work and your home. Free efile of state taxes Example 1. Free efile of state taxes You regularly work in an office in the city where you live. Free efile of state taxes Your employer sends you to a 1-week training session at a different office in the same city. Free efile of state taxes You travel directly from your home to the training location and return each day. Free efile of state taxes You can deduct the cost of your daily round-trip transportation between your home and the training location. Free efile of state taxes Example 2. Free efile of state taxes Your principal place of business is in your home. Free efile of state taxes You can deduct the cost of round-trip transportation between your qualifying home office and your client's or customer's place of business. Free efile of state taxes Example 3. Free efile of state taxes You have no regular office, and you do not have an office in your home. Free efile of state taxes In this case, the location of your first business contact inside the metropolitan area is considered your office. Free efile of state taxes Transportation expenses between your home and this first contact are nondeductible commuting expenses. Free efile of state taxes Transportation expenses between your last business contact and your home are also nondeductible commuting expenses. Free efile of state taxes While you cannot deduct the costs of these first and last trips, you can deduct the costs of going from one client or customer to another. Free efile of state taxes With no regular or home office, the costs of travel between two or more business contacts in a metropolitan area are deductible while the costs of travel between the home to (and from) business contacts are not deductible. Free efile of state taxes Car Expenses If you use your car for business purposes, you may be able to deduct car expenses. Free efile of state taxes You generally can use one of the two following methods to figure your deductible expenses. Free efile of state taxes Standard mileage rate. Free efile of state taxes Actual car expenses. Free efile of state taxes If you use actual car expenses to figure your deduction for a car you lease, there are rules that affect the amount of your lease payments you can deduct. Free efile of state taxes See Leasing a car under Actual Car Expenses, later. Free efile of state taxes In this chapter, “car” includes a van, pickup, or panel truck. Free efile of state taxes Rural mail carriers. Free efile of state taxes   If you are a rural mail carrier, you may be able to treat the amount of qualified reimbursement you received as the amount of your allowable expense. Free efile of state taxes Because the qualified reimbursement is treated as paid under an accountable plan, your employer should not include the amount of reimbursement in your income. Free efile of state taxes   If your vehicle expenses are more than the amount of your reimbursement, you can deduct the unreimbursed expenses as an itemized deduction on Schedule A (Form 1040). Free efile of state taxes You must complete Form 2106 and attach it to your Form 1040. Free efile of state taxes   A “qualified reimbursement” is the reimbursement you receive that meets both of the following conditions. Free efile of state taxes It is given as an equipment maintenance allowance (EMA) to employees of the U. Free efile of state taxes S. Free efile of state taxes Postal Service. Free efile of state taxes It is at the rate contained in the 1991 collective bargaining agreement. Free efile of state taxes Any later agreement cannot increase the qualified reimbursement amount by more than the rate of inflation. Free efile of state taxes See your employer for information on your reimbursement. Free efile of state taxes If you are a rural mail carrier and received a qualified reimbursement, you cannot use the standard mileage rate. Free efile of state taxes Standard Mileage Rate You may be able to use the standard mileage rate to figure the deductible costs of operating your car for business purposes. Free efile of state taxes For 2013, the standard mileage rate for business use is 56½ cents per mile. Free efile of state taxes If you use the standard mileage rate for a year, you cannot deduct your actual car expenses for that year, but see Parking fees and tolls, later. Free efile of state taxes You generally can use the standard mileage rate whether or not you are reimbursed and whether or not any reimbursement is more or less than the amount figured using the standard mileage rate. Free efile of state taxes See Reimbursements under How To Report, later. Free efile of state taxes Choosing the standard mileage rate. Free efile of state taxes   If you want to use the standard mileage rate for a car you own, you must choose to use it in the first year the car is available for use in your business. Free efile of state taxes Then in later years, you can choose to use either the standard mileage rate or actual expenses. Free efile of state taxes   If you want to use the standard mileage rate for a car you lease, you must use it for the entire lease period. Free efile of state taxes   You must make the choice to use the standard mileage rate by the due date (including extensions) of your return. Free efile of state taxes You cannot revoke the choice. Free efile of state taxes However, in a later year, you can switch from the standard mileage rate to the actual expenses method. Free efile of state taxes If you change to the actual expenses method in a later year, but before your car is fully depreciated, you have to estimate the remaining useful life of the car and use straight line depreciation. Free efile of state taxes Example. Free efile of state taxes Larry is an employee who occasionally uses his own car for business purposes. Free efile of state taxes He purchased the car in 2011, but he did not claim any unreimburse