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Boost your business travel deductions

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in Small Business Tax,Small Business Tax Deduction Strategies

Suppose you and your spouse plan on staying at a nice hotel during a business trip. Normally, you can’t deduct the cost for your spouse if he or she isn’t an employee.

Strategy: Don’t give up the ship just yet. If there’s a business purpose for the travel, you can still write off the cost attributable to the other person, even though you don’t work together.

In effect, you’re allowed to write off all the travel expenses of the trip—the airfare, lodging and 50% of the cost of meals—if the travel is primarily related to business activity. It doesn’t matter how you both qualify.  

Example: You’re flying to a business hub for your company’s annual sales meeting. At the same time, your spouse will be visiting several suppliers in the city for a sideline self-employed business. If you properly account for your travel, your employer-paid reimbursements are tax free to you and deductible by the company. Furthermore, your spouse can write off the travel expenses, too, on Schedule C for self-employed taxpayers.

In other words, you can boost your travel deductions if there’s a bona fide business reason. And even if your spouse simply tags along for the ride—there’s no business purpose to his or her travel—you’re in line for a tax break.

Tip: Deduct what it would have cost you to stay in a single room even if that’s more than half the cost of your double.

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