How to write off your vacation!
5 Tax tips for your travel & tourism business
One massive benefit of being an independent travel agent, blogger/content creator is that you have plenty of deductions that can be written off. You can even include your travels as an expense; keep reading to see what you can write off.
As a professional tax preparer over the last 10 years, I want to share with you some tax tips all content creators need to know. Below are the top five tax deductions you may not know about.
Business use of your vehicle
If you have to do any type of traveling for your business to meet a client or capture content, your expenses can be written off. If you choose to go on a road trip, your gas mileage for the year can be written off.
There are two possible expense options, so choose whichever comes out as a higher deduction.
Standard Expenses: Multiply total miles driven for business x standard mileage rate of 62.5¢/mile + 14¢/mile for miles driven doing charitable work
Actual Expenses: If you kept detailed records of all of your business driving, you could deduct any actual costs for gas, repairs, etc, based on the percentage of time you drove the care for business purposes. If your business is an LLC, and you are leasing a vehicle, you can deduct the car payments
Business travel expenses
You can write off travel expenses as long as its primarily for business purposes. The IRS requires for you to spend the majority of your trip doing business, as a travel blogger business can include costs of visiting attractions, research and investigation of destinations and tours.
Your rental car can be claimed if it is deemed “necessary” if you need to rent a car to get around, you’ll have trouble writing off the cost of a Range Rover if a Toyota Camry will get you there just as fast.
A list of some of the business travel expenses you can claim:
Plane, train, and bus tickets between your home and your business destination
Baggage fees
Laundry and dry cleaning during your trip
Rental car costs
Hotel and Airbnb costs
50% of eligible business meals
50% of meals while traveling to and from your destination
Lodging
The cost of your lodging is tax deductible. You can also potentially deduct the cost of accommodation on the days when you’re not conducting business. Still, it depends on how you schedule your trip. You can essentially squeeze in vacation days in-between business days. For example, fly into Miami on Thursday, work those two days, enjoy the beach Saturday and Sunday, work Monday, and fly out Tuesday. All of those days can be considered business related.
Home Office Deduction
Because independent travel agencies are often home-based, an excellent tax tip for travel agents is to take the home office deduction. You are allowed to deduct $5 per square foot of the portion of the home used for business, up to a maximum of 300 square feet.
Start-up costs, Equipment, and Supplies
Start-up costs: These deductions will apply only to your first year of operation. The cost of incorporating (an LLC) your business is an example of a startup expense. As a blogger, you’ll also have startup costs associated with building your website. This may include hiring a web developer to set up your website. The IRS allows you to deduct $5,000 in business startup costs and $5,000 in organizational costs if your total costs are $50,000 or less.
Examples of qualified business equipment are computers, computers/laptops, cameras, and/or carry-on bags.
Other examples include:
cell phones
Subscriptions such as Website hosting and domain fees
Office supplies can also be written off, so definitely keep your receipts from purchasing pens, paper, ink, toner, notepads, and anything else you use in your business.
Bottom Line for tax deductions for your travel business
Whether as a primary occupation or a side hustle, you're running a small business if you're blogging for a living. Since your blog is a business, you must treat it like one. That means taking taxes seriously, and part of doing that is using every tax deduction available to minimize your tax liability.
Make sure you make a note on the receipt, or in your expense-tracking app, about the nature of the meeting you conducted—who you met with, when, and what you discussed.
Use an app like Expensify to track business expenditures.
For more tax tips and strategies visit LRG Tax Services
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