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Tax Easy Form

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Tax Easy Form

Tax easy form Tax Changes for Individuals Table of Contents 2001 ChangesNew 5-Year Carryback Rule for Net Operating Losses (NOLs) Wash Sale Rules Do Not Apply to Section 1256 Contracts Other 2001 Changes 2002 ChangesDeduction for Educator Expenses Personal Credits Still Allowed Against Alternative Minimum Tax Later ChangeChild and Dependent Care Expenses 2001 Changes New 5-Year Carryback Rule for Net Operating Losses (NOLs) If you have an NOL from a tax year ending during 2001 or 2002, you must generally carry back the entire amount of the NOL to the 5 tax years before the NOL year (the carryback period). Tax easy form However, you can still choose to use the previous carryback period. Tax easy form You also can choose not to carry back an NOL and only carry it forward. Tax easy form Individuals, estates, and trusts can file Form 1045, Application for Tentative Refund. Tax easy form The instructions for this form will be revised to reflect the new law. Tax easy form Wash Sale Rules Do Not Apply to Section 1256 Contracts The wash sale rules that generally apply to losses from the sale of stock or securities, do not apply to any loss arising from a section 1256 contract. Tax easy form A section 1256 contract is any: Regulated futures contract, Foreign currency contract, Nonequity option, Dealer equity option, or Dealer securities futures contract. Tax easy form Wash sales and section 1256 contracts are explained in detail in Publication 550, Investment Income and Expenses. Tax easy form Other 2001 Changes Other changes are discussed in the following chapters. Tax easy form Chapter 4 Car Expenses Chapter 5 Depreciation 2002 Changes Deduction for Educator Expenses If you are an eligible educator, you can deduct as an adjustment to income up to $250 in qualified expenses. Tax easy form You can deduct these expenses even if you do not itemize deductions on Schedule A (Form 1040). Tax easy form This adjustment to income is for expenses paid or incurred in tax years beginning during 2002 or 2003. Tax easy form Previously, these expenses were deductible only as a miscellaneous itemized deduction subject to the 2% of adjusted gross income limit. Tax easy form Eligible educator. Tax easy form   You are an eligible educator if, for the tax year, you meet the following requirements. Tax easy form You are a kindergarten through grade 12: Teacher, Instructor, Counselor, Principal, or Aide. Tax easy form You work at least 900 hours during a school year in a school that provides elementary or secondary education, as determined under state law. Tax easy form Qualified expenses. Tax easy form   These are unreimbursed expenses you paid or incurred for books, supplies, computer equipment (including related software and services), other equipment, and supplementary materials that you use in the classroom. Tax easy form For courses in health and physical education, expenses for supplies are qualified expenses only if they are related to athletics. Tax easy form   To be deductible as an adjustment to income, the qualified expenses must be more than the following amounts for the tax year. Tax easy form The interest on qualified U. Tax easy form S. Tax easy form savings bonds that you excluded from income because you paid qualified higher education expenses, Any distribution from a qualified tuition program that you excluded from income, or Any tax-free withdrawals from your Coverdell education savings account. Tax easy form Personal Credits Still Allowed Against Alternative Minimum Tax The provision that allowed certain nonrefundable personal credits to reduce both your regular tax and any alternative minimum tax (AMT) has been extended and will be in effect for 2002 and 2003. Tax easy form This provision, as it applies to the AMT, was originally scheduled to expire after 2001. Tax easy form Without the extension, these credits could not have been used to reduce any AMT in 2002 or 2003. Tax easy form Later Change Child and Dependent Care Expenses For the purpose of figuring the child and dependent care credit, your spouse is treated as having at least a minimum amount of earned income for any month that he or she is a full-time student or not able to care for himself or herself. Tax easy form Beginning in 2003, this amount is increased to $250 a month if there is one qualifying person and to $500 a month if there are two or more qualifying persons. Tax easy form Before 2003, the amounts were $200 and $400. Tax easy form The same rule applies for the exclusion of employer-provided dependent care benefits. Tax easy form For more information about the credit and exclusion, see Publication 503, Child and Dependent Care Expenses. Tax easy form Prev  Up  Next   Home   More Online Publications
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Consumer Protection Offices

City, county, regional, and state consumer offices offer a variety of important services. They might mediate complaints, conduct investigations, prosecute offenders of consumer laws, license and regulate professional service providers, provide educational materials and advocate for consumer rights. To save time, call before sending a written complaint. Ask if the office handles the type of complaint you have and if complaint forms are provided.

State Consumer Protection Offices

Washington Office of the Attorney General

Website: Washington Office of the Attorney General

Address: Washington Office of the Attorney General
Consumer Protection Division
PO Box 40100
1125 Washington St., SE
Olympia, WA 98504-0100

Phone Number: 206-464-6684

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

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Regional Consumer Protection Offices

Tacoma Office of the Attorney General

Website: Tacoma Office of the Attorney General

Address: Tacoma Office of the Attorney General
Consumer Protection Division
1250 Pacific Ave., Suite 105
Tacoma, WA 98402

Phone Number: 253-593-5243

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

Vancouver Office of the Attorney General

Website: Vancouver Office of the Attorney General

Address: Vancouver Office of the Attorney General
Consumer Protection Division
1220 Main St., Suite 510
Vancouver, WA 98660

Phone Number: 360-759-2100

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

Bellingham Office of the Attorney General

Website: Bellingham Office of the Attorney General

Address: Bellingham Office of the Attorney General
Consumer Protection Division
103 E. Holly St., Suite 310
Bellingham, WA 98225

Phone Number: 360-676-2037

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

Seattle Office of the Attorney General

Website: Seattle Office of the Attorney General

Address: Seattle Office of the Attorney General
Consumer Protection Division
800 5th Ave., Suite 2000
Seattle, WA 98104

Phone Number: 206-464-7744

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

Spokane Office of the Attorney General

Website: Spokane Office of the Attorney General

Address: Spokane Office of the Attorney General
Consumer Protection Division (Eastern Washington)
1116 W. Riverside Ave.
Spokane, WA 99201-1194

Phone Number: 509-456-3123

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

Kennewick Office of the Attorney General

Website: Kennewick Office of the Attorney General

Address: Kennewick Office of the Attorney General
Consumer Protection Division
8127 W. Klamath Ct.
Kennewick, WA 99336-2607

Phone Number: 509-734-7285

Toll-free: 1-800-551-4636 (WA)

TTY: 1-800-833-6388

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Banking Authorities

The officials listed in this section regulate and supervise state-chartered banks. Many of them handle or refer problems and complaints about other types of financial institutions as well. Some also answer general questions about banking and consumer credit. If you are dealing with a federally chartered bank, check Federal Agencies.

Department of Financial Institutions

Website: Department of Financial Institutions

Address: Department of Financial Institutions
Division of Banks
PO Box 41200
Olympia, WA 98504-1200

Phone Number: 360-902-8704

Toll-free: 1-877-746-4334
1-888-976-4422 (in Spanish) 1-888-976-4422 (in Spanish)

TTY: 360-664-8126

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Insurance Regulators

Each state has its own laws and regulations for each type of insurance. The officials listed in this section enforce these laws. Many of these offices can also provide you with information to help you make informed insurance buying decisions.

Office of the Insurance Commissioner

Website: Office of the Insurance Commissioner

Address: Office of the Insurance Commissioner
Consumer Protection
PO Box 40256
Olympia, WA 98504-0256

Phone Number: 360-725-7080

Toll-free: 1-800-562-6900 (WA)

TTY: 360-586-0241

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Securities Administrators

Each state has its own laws and regulations for securities brokers and securities - including stocks, mutual funds, commodities, real estate, etc. The officials and agencies listed in this section enforce these laws and regulations. Many of these offices can also provide information to help you make informed investment decisions.

Department of Financial Institutions

Website: Department of Financial Institutions

Address: Department of Financial Institutions
Division of Securities
PO Box 9033
Olympia, WA 98507-9033

Phone Number: 360-902-8760

Toll-free: 1-877-746-4334

TTY: 360-664-8126

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Utility Commissions

State Utility Commissions regulate services and rates for gas, electricity and telephones within your state. In some states, the utility commissions regulate other services such as water, transportation, and the moving of household goods. Many utility commissions handle consumer complaints. Sometimes, if a number of complaints are received about the same utility matter, they will conduct investigations.

Utilities and Transportation Commission

Website: Utilities and Transportation Commission

Address: Utilities and Transportation Commission
Consumer Protection
PO Box 47250
Olympia, WA 98504

Phone Number: 360-664-1160

Toll-free: 1-888-333-9882

TTY: 1-800-416-5289

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The Tax Easy Form

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