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Form 1040 2010

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Form 1040 2010

Form 1040 2010 6. Form 1040 2010   How To Get Tax Help Table of Contents Whether it's help with a tax issue, preparing your tax return or a need for a free publication or form, get the help you need the way you want it: online, use a smart phone, call or walk in to an IRS office or volunteer site near you. Form 1040 2010 Free help with your return. Form 1040 2010   You can get free help preparing your return nationwide from IRS-certified volunteers. Form 1040 2010 The Volunteer Income Tax Assistance (VITA) program helps low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers. Form 1040 2010 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Form 1040 2010 Most VITA and TCE sites offer free electronic filing and all volunteers will let you know about credits and deductions you may be entitled to claim. Form 1040 2010 In addition, some VITA and TCE sites provide taxpayers the opportunity to prepare their own return with help from an IRS-certified volunteer. Form 1040 2010 To find the nearest VITA or TCE site, you can use the VITA Locator Tool on IRS. Form 1040 2010 gov, download the IRS2Go app, or call 1-800-906-9887. Form 1040 2010   As part of the TCE program, AARP offers the Tax-Aide counseling program. Form 1040 2010 To find the nearest AARP Tax-Aide site, visit AARP's website at www. Form 1040 2010 aarp. Form 1040 2010 org/money/taxaide or call 1-888-227-7669. Form 1040 2010 For more information on these programs, go to IRS. Form 1040 2010 gov and enter “VITA” in the search box. Form 1040 2010   For more information on these programs, go to IRS. Form 1040 2010 gov and enter “VITA” in the search box. Form 1040 2010 Internet. Form 1040 2010    IRS. Form 1040 2010 gov and IRS2Go are ready when you are —24 hours a day, 7 days a week. Form 1040 2010 Download the free IRS2Go app from the iTunes app store or from Google Play. Form 1040 2010 Use it to check your refund status, order transcripts of your tax returns or tax account, watch the IRS YouTube channel, get IRS news as soon as it's released to the public, subscribe to filing season updates or daily tax tips, and follow the IRS Twitter news feed, @IRSnews, to get the latest federal tax news, including information about tax law changes and important IRS programs. Form 1040 2010 Check the status of your 2013 refund with the Where's My Refund? application on IRS. Form 1040 2010 gov or download the IRS2Go app and select the Refund Status option. Form 1040 2010 The IRS issues more than 9 out of 10 refunds in less than 21 days. Form 1040 2010 Using these applications, you can start checking on the status of your return within 24 hours after we receive your e-filed return or 4 weeks after you mail a paper return. Form 1040 2010 You will also be given a personalized refund date as soon as the IRS processes your tax return and approves your refund. Form 1040 2010 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Form 1040 2010 Use the Interactive Tax Assistant (ITA) to research your tax questions. Form 1040 2010 No need to wait on the phone or stand in line. Form 1040 2010 The ITA is available 24 hours a day, 7 days a week, and provides you with a variety of tax information related to general filing topics, deductions, credits, and income. Form 1040 2010 When you reach the response screen, you can print the entire interview and the final response for your records. Form 1040 2010 New subject areas are added on a regular basis. Form 1040 2010  Answers not provided through ITA may be found in Tax Trails, one of the Tax Topics on IRS. Form 1040 2010 gov which contain general individual and business tax information or by searching the IRS Tax Map, which includes an international subject index. Form 1040 2010 You can use the IRS Tax Map, to search publications and instructions by topic or keyword. Form 1040 2010 The IRS Tax Map integrates forms and publications into one research tool and provides single-point access to tax law information by subject. Form 1040 2010 When the user searches the IRS Tax Map, they will be provided with links to related content in existing IRS publications, forms and instructions, questions and answers, and Tax Topics. Form 1040 2010 Coming this filing season, you can immediately view and print for free all 5 types of individual federal tax transcripts (tax returns, tax account, record of account, wage and income statement, and certification of non-filing) using Get Transcript. Form 1040 2010 You can also ask the IRS to mail a return or an account transcript to you. Form 1040 2010 Only the mail option is available by choosing the Tax Records option on the IRS2Go app by selecting Mail Transcript on IRS. Form 1040 2010 gov or by calling 1-800-908-9946. Form 1040 2010 Tax return and tax account transcripts are generally available for the current year and the past three years. Form 1040 2010 Determine if you are eligible for the EITC and estimate the amount of the credit with the Earned Income Tax Credit (EITC) Assistant. Form 1040 2010 Visit Understanding Your IRS Notice or Letter to get answers to questions about a notice or letter you received from the IRS. Form 1040 2010 If you received the First Time Homebuyer Credit, you can use the First Time Homebuyer Credit Account Look-up tool for information on your repayments and account balance. Form 1040 2010 Check the status of your amended return using Where's My Amended Return? Go to IRS. Form 1040 2010 gov and enter Where's My Amended Return? in the search box. Form 1040 2010 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Form 1040 2010 It can take up to 3 weeks from the date you mailed it to show up in our system. Form 1040 2010 Make a payment using one of several safe and convenient electronic payment options available on IRS. Form 1040 2010 gov. Form 1040 2010 Select the Payment tab on the front page of IRS. Form 1040 2010 gov for more information. Form 1040 2010 Determine if you are eligible and apply for an online payment agreement, if you owe more tax than you can pay today. Form 1040 2010 Figure your income tax withholding with the IRS Withholding Calculator on IRS. Form 1040 2010 gov. Form 1040 2010 Use it if you've had too much or too little withheld, your personal situation has changed, you're starting a new job or you just want to see if you're having the right amount withheld. Form 1040 2010 Determine if you might be subject to the Alternative Minimum Tax by using the Alternative Minimum Tax Assistant on IRS. Form 1040 2010 gov. Form 1040 2010 Request an Electronic Filing PIN by going to IRS. Form 1040 2010 gov and entering Electronic Filing PIN in the search box. Form 1040 2010 Download forms, instructions and publications, including accessible versions for people with disabilities. Form 1040 2010 Locate the nearest Taxpayer Assistance Center (TAC) using the Office Locator tool on IRS. Form 1040 2010 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices. Form 1040 2010 An employee can answer questions about your tax account or help you set up a payment plan. Form 1040 2010 Before you visit, check the Office Locator on IRS. Form 1040 2010 gov, or Local Offices under Contact Us on IRS2Go to confirm the address, phone number, days and hours of operation, and the services provided. Form 1040 2010 If you have a special need, such as a disability, you can request an appointment. Form 1040 2010 Call the local number listed in the Office Locator, or look in the phone book under United States Government, Internal Revenue Service. Form 1040 2010 Apply for an Employer Identification Number (EIN). Form 1040 2010 Go to IRS. Form 1040 2010 gov and enter Apply for an EIN in the search box. Form 1040 2010 Read the Internal Revenue Code, regulations, or other official guidance. Form 1040 2010 Read Internal Revenue Bulletins. Form 1040 2010 Sign up to receive local and national tax news and more by email. Form 1040 2010 Just click on “subscriptions” above the search box on IRS. Form 1040 2010 gov and choose from a variety of options. Form 1040 2010 Phone. Form 1040 2010    You can call the IRS, or you can carry it in your pocket with the IRS2Go app on your smart phone or tablet. Form 1040 2010 Download the free IRS2Go app from the iTunes app store or from Google Play. Form 1040 2010 Call to locate the nearest volunteer help site, 1-800-906-9887 or you can use the VITA Locator Tool on IRS. Form 1040 2010 gov, or download the IRS2Go app. Form 1040 2010 Low-to-moderate income, elderly, people with disabilities, and limited English proficient taxpayers can get free help with their tax return from the nationwide Volunteer Income Tax Assistance (VITA) program. Form 1040 2010 The Tax Counseling for the Elderly (TCE) program helps taxpayers age 60 and older with their tax returns. Form 1040 2010 Most VITA and TCE sites offer free electronic filing. Form 1040 2010 Some VITA and TCE sites provide IRS-certified volunteers who can help prepare your tax return. Form 1040 2010 Through the TCE program, AARP offers the Tax-Aide counseling program; call 1-888-227-7669 to find the nearest Tax-Aide location. Form 1040 2010 Call the automated Where's My Refund? information hotline to check the status of your 2013 refund 24 hours a day, 7 days a week at 1-800-829-1954. Form 1040 2010 If you e-file, you can start checking on the status of your return within 24 hours after the IRS receives your tax return or 4 weeks after you've mailed a paper return. Form 1040 2010 The IRS issues more than 9 out of 10 refunds in less than 21 days. Form 1040 2010 Where's My Refund? will give you a personalized refund date as soon as the IRS processes your tax return and approves your refund. Form 1040 2010 Before you call this automated hotline, have your 2013 tax return handy so you can enter your social security number, your filing status, and the exact whole dollar amount of your refund. Form 1040 2010 The IRS updates Where's My Refund? every 24 hours, usually overnight, so you only need to check once a day. Form 1040 2010 Note, the above information is for our automated hotline. Form 1040 2010 Our live phone and walk-in assistors can research the status of your refund only if it's been 21 days or more since you filed electronically or more than 6 weeks since you mailed your paper return. Form 1040 2010 Call the Amended Return Hotline, 1-866-464-2050, to check the status of your amended return. Form 1040 2010 You can generally expect your amended return to be processed up to 12 weeks from the date we receive it. Form 1040 2010 It can take up to 3 weeks from the date you mailed it to show up in our system. Form 1040 2010 Call 1-800-TAX-FORM (1-800-829-3676) to order current-year forms, instructions, publications, and prior-year forms and instructions (limited to 5 years). Form 1040 2010 You should receive your order within 10 business days. Form 1040 2010 Call TeleTax, 1-800-829-4477, to listen to pre-recorded messages covering general and business tax information. Form 1040 2010 If, between January and April 15, you still have questions about the Form 1040, 1040A, or 1040EZ (like filing requirements, dependents, credits, Schedule D, pensions and IRAs or self-employment taxes), call 1-800-829-1040. Form 1040 2010 Call using TTY/TDD equipment, 1-800-829-4059 to ask tax questions or order forms and publications. Form 1040 2010 The TTY/TDD telephone number is for people who are deaf, hard of hearing, or have a speech disability. Form 1040 2010 These individuals can also contact the IRS through relay services such as the Federal Relay Service. Form 1040 2010 Walk-in. Form 1040 2010   You can find a selection of forms, publications and services — in-person. Form 1040 2010 Products. Form 1040 2010 You can walk in to some post offices, libraries, and IRS offices to pick up certain forms, instructions, and publications. Form 1040 2010 Some IRS offices, libraries, and city and county government offices have a collection of products available to photocopy from reproducible proofs. Form 1040 2010 Services. Form 1040 2010 You can walk in to your local TAC for face-to-face tax help. Form 1040 2010 An employee can answer questions about your tax account or help you set up a payment plan. Form 1040 2010 Before visiting, use the Office Locator tool on IRS. Form 1040 2010 gov, or choose the Contact Us option on the IRS2Go app and search Local Offices for days and hours of operation, and services provided. Form 1040 2010 Mail. Form 1040 2010   You can send your order for forms, instructions, and publications to the address below. Form 1040 2010 You should receive a response within 10 business days after your request is received. Form 1040 2010 Internal Revenue Service 1201 N. Form 1040 2010 Mitsubishi Motorway Bloomington, IL 61705-6613    The Taxpayer Advocate Service Is Here to Help You. Form 1040 2010 The Taxpayer Advocate Service (TAS) is your voice at the IRS. Form 1040 2010 Our job is to ensure that every taxpayer is treated fairly and that you know and understand your rights. Form 1040 2010   What can TAS do for you? We can offer you free help with IRS problems that you can't resolve on your own. Form 1040 2010 We know this process can be confusing, but the worst thing you can do is nothing at all! TAS can help if you can't resolve your tax problem and: Your problem is causing financial difficulties for you, your family, or your business. Form 1040 2010 You face (or your business is facing) an immediate threat of adverse action. Form 1040 2010 You've tried repeatedly to contact the IRS but no one has responded, or the IRS hasn't responded by the date promised. Form 1040 2010   If you qualify for our help, you'll be assigned to one advocate who'll be with you at every turn and will do everything possible to resolve your problem. Form 1040 2010 Here's why we can help: TAS is an independent organization within the IRS. Form 1040 2010 Our advocates know how to work with the IRS. Form 1040 2010 Our services are free and tailored to meet your needs. Form 1040 2010 We have offices in every state, the District of Columbia, and Puerto Rico. Form 1040 2010   How can you reach us? If you think TAS can help you, call your local advocate, whose number is in your local directory and at Taxpayer Advocate, or call us toll-free at 1-877-777-4778. Form 1040 2010   How else does TAS help taxpayers?  TAS also works to resolve large-scale, systemic problems that affect many taxpayers. Form 1040 2010 If you know of one of these broad issues, please report it to us through our Systemic Advocacy Management System. Form 1040 2010 Low Income Taxpayer Clinics   Low Income Taxpayer Clinics (LITCs) serve individuals whose income is below a certain level and need to resolve tax problems such as audits, appeals and tax collection disputes. Form 1040 2010 Some clinics can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Form 1040 2010 Visit Taxpayer Advocate or see IRS Publication 4134, Low Income Taxpayer Clinic List. Form 1040 2010 Prev  Up  Next   Home   More Online Publications
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The Form 1040 2010

Form 1040 2010 1. Form 1040 2010   Travel Table of Contents Traveling Away From HomeTax Home Tax Home Different From Family Home Temporary Assignment or Job What Travel Expenses Are Deductible?Employee. Form 1040 2010 Business associate. Form 1040 2010 Bona fide business purpose. Form 1040 2010 Meals Travel in the United States Travel Outside the United States Luxury Water Travel Conventions If you temporarily travel away from your tax home, you can use this chapter to determine if you have deductible travel expenses. Form 1040 2010 This chapter discusses: Traveling away from home, Temporary assignment or job, and What travel expenses are deductible. Form 1040 2010 It also discusses the standard meal allowance, rules for travel inside and outside the United States, luxury water travel, and deductible convention expenses. Form 1040 2010 Travel expenses defined. Form 1040 2010   For tax purposes, travel expenses are the ordinary and necessary expenses of traveling away from home for your business, profession, or job. Form 1040 2010   An ordinary expense is one that is common and accepted in your trade or business. Form 1040 2010 A necessary expense is one that is helpful and appropriate for your business. Form 1040 2010 An expense does not have to be required to be considered necessary. Form 1040 2010   You will find examples of deductible travel expenses in Table 1-1 , later. Form 1040 2010 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. Form 1040 2010 This rest requirement is not satisfied by merely napping in your car. Form 1040 2010 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. Form 1040 2010 Example 1. Form 1040 2010 You are a railroad conductor. Form 1040 2010 You leave your home terminal on a regularly scheduled round-trip run between two cities and return home 16 hours later. Form 1040 2010 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. Form 1040 2010 You are considered to be away from home. Form 1040 2010 Example 2. Form 1040 2010 You are a truck driver. Form 1040 2010 You leave your terminal and return to it later the same day. Form 1040 2010 You get an hour off at your turnaround point to eat. Form 1040 2010 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. Form 1040 2010 Members of the Armed Forces. Form 1040 2010   If you are a member of the U. Form 1040 2010 S. Form 1040 2010 Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. Form 1040 2010 You cannot deduct your expenses for meals and lodging. Form 1040 2010 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. Form 1040 2010 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. Form 1040 2010   A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a tax home (explained next) aboard the ship for travel expense purposes. Form 1040 2010 Tax Home To determine whether you are traveling away from home, you must first determine the location of your tax home. Form 1040 2010 Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. Form 1040 2010 It includes the entire city or general area in which your business or work is located. Form 1040 2010 If you have more than one regular place of business, your tax home is your main place of business. Form 1040 2010 See Main place of business or work , later. Form 1040 2010 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. Form 1040 2010 See No main place of business or work , later. Form 1040 2010 If you do not have a regular or main place of business or post of duty and there is no place where you regularly live, you are considered an itinerant (a transient) and your tax home is wherever you work. Form 1040 2010 As an itinerant, you cannot claim a travel expense deduction because you are never considered to be traveling away from home. Form 1040 2010 Main place of business or work. Form 1040 2010   If you have more than one place of work, consider the following when determining which one is your main place of business or work. Form 1040 2010 The total time you ordinarily spend in each place. Form 1040 2010 The level of your business activity in each place. Form 1040 2010 Whether your income from each place is significant or insignificant. Form 1040 2010 Example. Form 1040 2010 You live in Cincinnati where you have a seasonal job for 8 months each year and earn $40,000. Form 1040 2010 You work the other 4 months in Miami, also at a seasonal job, and earn $15,000. Form 1040 2010 Cincinnati is your main place of work because you spend most of your time there and earn most of your income there. Form 1040 2010 No main place of business or work. Form 1040 2010   You may have a tax home even if you do not have a regular or main place of work. Form 1040 2010 Your tax home may be the home where you regularly live. Form 1040 2010 Factors used to determine tax home. Form 1040 2010   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. Form 1040 2010 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. Form 1040 2010 You have living expenses at your main home that you duplicate because your business requires you to be away from that home. Form 1040 2010 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. Form 1040 2010   If you satisfy all three factors, your tax home is the home where you regularly live. Form 1040 2010 If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. Form 1040 2010 If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses. Form 1040 2010 Example 1. Form 1040 2010 You are single and live in Boston in an apartment you rent. Form 1040 2010 You have worked for your employer in Boston for a number of years. Form 1040 2010 Your employer enrolls you in a 12-month executive training program. Form 1040 2010 You do not expect to return to work in Boston after you complete your training. Form 1040 2010 During your training, you do not do any work in Boston. Form 1040 2010 Instead, you receive classroom and on-the-job training throughout the United States. Form 1040 2010 You keep your apartment in Boston and return to it frequently. Form 1040 2010 You use your apartment to conduct your personal business. Form 1040 2010 You also keep up your community contacts in Boston. Form 1040 2010 When you complete your training, you are transferred to Los Angeles. Form 1040 2010 You do not satisfy factor (1) because you did not work in Boston. Form 1040 2010 You satisfy factor (2) because you had duplicate living expenses. Form 1040 2010 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. Form 1040 2010 Therefore, you have a tax home in Boston. Form 1040 2010 Example 2. Form 1040 2010 You are an outside salesperson with a sales territory covering several states. Form 1040 2010 Your employer's main office is in Newark, but you do not conduct any business there. Form 1040 2010 Your work assignments are temporary, and you have no way of knowing where your future assignments will be located. Form 1040 2010 You have a room in your married sister's house in Dayton. Form 1040 2010 You stay there for one or two weekends a year, but you do no work in the area. Form 1040 2010 You do not pay your sister for the use of the room. Form 1040 2010 You do not satisfy any of the three factors listed earlier. Form 1040 2010 You are an itinerant and have no tax home. Form 1040 2010 Tax Home Different From Family Home If you (and your family) do not live at your tax home (defined earlier), you cannot deduct the cost of traveling between your tax home and your family home. Form 1040 2010 You also cannot deduct the cost of meals and lodging while at your tax home. Form 1040 2010 See Example 1 , later. Form 1040 2010 If you are working temporarily in the same city where you and your family live, you may be considered as traveling away from home. Form 1040 2010 See Example 2 , later. Form 1040 2010 Example 1. Form 1040 2010 You are a truck driver and you and your family live in Tucson. Form 1040 2010 You are employed by a trucking firm that has its terminal in Phoenix. Form 1040 2010 At the end of your long runs, you return to your home terminal in Phoenix and spend one night there before returning home. Form 1040 2010 You cannot deduct any expenses you have for meals and lodging in Phoenix or the cost of traveling from Phoenix to Tucson. Form 1040 2010 This is because Phoenix is your tax home. Form 1040 2010 Example 2. Form 1040 2010 Your family home is in Pittsburgh, where you work 12 weeks a year. Form 1040 2010 The rest of the year you work for the same employer in Baltimore. Form 1040 2010 In Baltimore, you eat in restaurants and sleep in a rooming house. Form 1040 2010 Your salary is the same whether you are in Pittsburgh or Baltimore. Form 1040 2010 Because you spend most of your working time and earn most of your salary in Baltimore, that city is your tax home. Form 1040 2010 You cannot deduct any expenses you have for meals and lodging there. Form 1040 2010 However, when you return to work in Pittsburgh, you are away from your tax home even though you stay at your family home. Form 1040 2010 You can deduct the cost of your round trip between Baltimore and Pittsburgh. Form 1040 2010 You can also deduct your part of your family's living expenses for meals and lodging while you are living and working in Pittsburgh. Form 1040 2010 Temporary Assignment or Job You may regularly work at your tax home and also work at another location. Form 1040 2010 It may not be practical to return to your tax home from this other location at the end of each work day. Form 1040 2010 Temporary assignment vs. Form 1040 2010 indefinite assignment. Form 1040 2010   If your assignment or job away from your main place of work is temporary, your tax home does not change. Form 1040 2010 You are considered to be away from home for the whole period you are away from your main place of work. Form 1040 2010 You can deduct your travel expenses if they otherwise qualify for deduction. Form 1040 2010 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. Form 1040 2010    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. Form 1040 2010 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. Form 1040 2010   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. Form 1040 2010 You may be able to deduct the cost of relocating to your new tax home as a moving expense. Form 1040 2010 See Publication 521 for more information. Form 1040 2010 Exception for federal crime investigations or prosecutions. Form 1040 2010   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule. Form 1040 2010 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. Form 1040 2010   For you to qualify, the Attorney General (or his or her designee) must certify that you are traveling: For the federal government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. Form 1040 2010 Determining temporary or indefinite. Form 1040 2010   You must determine whether your assignment is temporary or indefinite when you start work. Form 1040 2010 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. Form 1040 2010 An assignment or job that is initially temporary may become indefinite due to changed circumstances. Form 1040 2010 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. Form 1040 2010   The following examples illustrate whether an assignment or job is temporary or indefinite. Form 1040 2010 Example 1. Form 1040 2010 You are a construction worker. Form 1040 2010 You live and regularly work in Los Angeles. Form 1040 2010 You are a member of a trade union in Los Angeles that helps you get work in the Los Angeles area. Form 1040 2010 Your tax home is Los Angeles. Form 1040 2010 Because of a shortage of work, you took a job on a construction project in Fresno. Form 1040 2010 Your job was scheduled to end in 8 months. Form 1040 2010 The job actually lasted 10 months. Form 1040 2010 You realistically expected the job in Fresno to last 8 months. Form 1040 2010 The job actually did last less than 1 year. Form 1040 2010 The job is temporary and your tax home is still in Los Angeles. Form 1040 2010 Example 2. Form 1040 2010 The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 18 months. Form 1040 2010 The job actually was completed in 10 months. Form 1040 2010 Your job in Fresno is indefinite because you realistically expected the work to last longer than 1 year, even though it actually lasted less than 1 year. Form 1040 2010 You cannot deduct any travel expenses you had in Fresno because Fresno became your tax home. Form 1040 2010 Example 3. Form 1040 2010 The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 9 months. Form 1040 2010 After 8 months, however, you were asked to remain for 7 more months (for a total actual stay of 15 months). Form 1040 2010 Initially, you realistically expected the job in Fresno to last for only 9 months. Form 1040 2010 However, due to changed circumstances occurring after 8 months, it was no longer realistic for you to expect that the job in Fresno would last for 1 year or less. Form 1040 2010 You can only deduct your travel expenses for the first 8 months. Form 1040 2010 You cannot deduct any travel expenses you had after that time because Fresno became your tax home when the job became indefinite. Form 1040 2010 Going home on days off. Form 1040 2010   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. Form 1040 2010 You cannot deduct the cost of your meals and lodging there. Form 1040 2010 However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home. Form 1040 2010 You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. Form 1040 2010   If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. Form 1040 2010 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. Form 1040 2010 Probationary work period. Form 1040 2010   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. Form 1040 2010 You cannot deduct any of your expenses for meals and lodging during the probationary period. Form 1040 2010 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. Form 1040 2010 You can deduct ordinary and necessary expenses you have when you travel away from home on business. Form 1040 2010 The type of expense you can deduct depends on the facts and your circumstances. Form 1040 2010 Table 1-1 summarizes travel expenses you may be able to deduct. Form 1040 2010 You may have other deductible travel expenses that are not covered there, depending on the facts and your circumstances. Form 1040 2010 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. Form 1040 2010 You can use a log, diary, notebook, or any other written record to keep track of your expenses. Form 1040 2010 The types of expenses you need to record, along with supporting documentation, are described in Table 5-1 (see chapter 5). Form 1040 2010 Separating costs. Form 1040 2010   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. Form 1040 2010 You must have a reasonable basis for making this allocation. Form 1040 2010 For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. Form 1040 2010 Travel expenses for another individual. Form 1040 2010    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. Form 1040 2010 Employee. Form 1040 2010   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. Form 1040 2010 Business associate. Form 1040 2010   If a business associate travels with you and meets the conditions in (2) and (3), earlier, you can deduct the travel expenses you have for that person. Form 1040 2010 A business associate is someone with whom you could reasonably expect to actively conduct business. Form 1040 2010 A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor. Form 1040 2010 Bona fide business purpose. Form 1040 2010   A bona fide business purpose exists if you can prove a real business purpose for the individual's presence. Form 1040 2010 Incidental services, such as typing notes or assisting in entertaining customers, are not enough to make the expenses deductible. Form 1040 2010 Table 1-1. Form 1040 2010 Travel Expenses You Can Deduct   This chart summarizes expenses you can deduct when you travel away from home for business purposes. Form 1040 2010 IF you have expenses for. Form 1040 2010 . Form 1040 2010 . Form 1040 2010 THEN you can deduct the cost of. Form 1040 2010 . Form 1040 2010 . Form 1040 2010 transportation travel by airplane, train, bus, or car between your home and your business destination. Form 1040 2010 If you were provided with a free ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero. Form 1040 2010 If you travel by ship, see Luxury Water Travel and Cruise Ships (under Conventions) for additional rules and limits. Form 1040 2010 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. Form 1040 2010 baggage and shipping sending baggage and sample or display material between your regular and temporary work locations. Form 1040 2010 car operating and maintaining your car when traveling away from home on business. Form 1040 2010 You can deduct actual expenses or the standard mileage rate, as well as business-related tolls and parking. Form 1040 2010 If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. Form 1040 2010 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. Form 1040 2010 Meals include amounts spent for food, beverages, taxes, and related tips. Form 1040 2010 See Meals for additional rules and limits. Form 1040 2010 cleaning dry cleaning and laundry. Form 1040 2010 telephone business calls while on your business trip. Form 1040 2010 This includes business communication by fax machine or other communication devices. Form 1040 2010 tips tips you pay for any expenses in this chart. Form 1040 2010 other other similar ordinary and necessary expenses related to your business travel. Form 1040 2010 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. Form 1040 2010 Example. Form 1040 2010 Jerry drives to Chicago on business and takes his wife, Linda, with him. Form 1040 2010 Linda is not Jerry's employee. Form 1040 2010 Linda occasionally types notes, performs similar services, and accompanies Jerry to luncheons and dinners. Form 1040 2010 The performance of these services does not establish that her presence on the trip is necessary to the conduct of Jerry's business. Form 1040 2010 Her expenses are not deductible. Form 1040 2010 Jerry pays $199 a day for a double room. Form 1040 2010 A single room costs $149 a day. Form 1040 2010 He can deduct the total cost of driving his car to and from Chicago, but only $149 a day for his hotel room. Form 1040 2010 If he uses public transportation, he can deduct only his fare. Form 1040 2010 Meals You can deduct the cost of meals in either of the following situations. Form 1040 2010 It is necessary for you to stop for substantial sleep or rest to properly perform your duties while traveling away from home on business. Form 1040 2010 The meal is business-related entertainment. Form 1040 2010 Business-related entertainment is discussed in chapter 2 . Form 1040 2010 The following discussion deals only with meals that are not business-related entertainment. Form 1040 2010 Lavish or extravagant. Form 1040 2010   You cannot deduct expenses for meals that are lavish or extravagant. Form 1040 2010 An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. Form 1040 2010 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. Form 1040 2010 50% limit on meals. Form 1040 2010   You can figure your meals expense using either of the following methods. Form 1040 2010 Actual cost. Form 1040 2010 The standard meal allowance. Form 1040 2010 Both of these methods are explained below. Form 1040 2010 But, regardless of the method you use, you generally can deduct only 50% of the unreimbursed cost of your meals. Form 1040 2010   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. Form 1040 2010 If you are not reimbursed, the 50% limit applies whether the unreimbursed meal expense is for business travel or business entertainment. Form 1040 2010 Chapter 2 discusses the 50% Limit in more detail, and chapter 6 discusses accountable and nonaccountable plans. Form 1040 2010 Actual Cost You can use the actual cost of your meals to figure the amount of your expense before reimbursement and application of the 50% deduction limit. Form 1040 2010 If you use this method, you must keep records of your actual cost. Form 1040 2010 Standard Meal Allowance Generally, you can use the “standard meal allowance” method as an alternative to the actual cost method. Form 1040 2010 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. Form 1040 2010 The set amount varies depending on where and when you travel. Form 1040 2010 In this publication, “standard meal allowance” refers to the federal rate for M&IE, discussed later under Amount of standard meal allowance . Form 1040 2010 If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel. Form 1040 2010 See the recordkeeping rules for travel in chapter 5 . Form 1040 2010 Incidental expenses. Form 1040 2010   The term “incidental expenses” means fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. Form 1040 2010   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. Form 1040 2010 Incidental-expenses-only method. Form 1040 2010   You can use an optional method (instead of actual cost) for deducting incidental expenses only. Form 1040 2010 The amount of the deduction is $5 a day. Form 1040 2010 You can use this method only if you did not pay or incur any meal expenses. Form 1040 2010 You cannot use this method on any day that you use the standard meal allowance. Form 1040 2010 This method is subject to the proration rules for partial days. Form 1040 2010 See Travel for days you depart and return , later in this chapter. Form 1040 2010 Note. Form 1040 2010 The incidental-expenses-only method is not subject to the 50% limit discussed below. Form 1040 2010 Federal employees should refer to the Federal Travel Regulations at www. Form 1040 2010 gsa. Form 1040 2010 gov. Form 1040 2010 Find the “Most Requested Links” on the upper left and click on “Regulations: FAR, FMR, FTR” for Federal Travel Regulation (FTR) for changes affecting claims for reimbursement. Form 1040 2010 50% limit may apply. Form 1040 2010   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. Form 1040 2010 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. Form 1040 2010 The 50% limit is discussed in more detail in chapter 2, and accountable and nonaccountable plans are discussed in chapter 6. Form 1040 2010 There is no optional standard lodging amount similar to the standard meal allowance. Form 1040 2010 Your allowable lodging expense deduction is your actual cost. Form 1040 2010 Who can use the standard meal allowance. Form 1040 2010   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. Form 1040 2010 Use of the standard meal allowance for other travel. Form 1040 2010   You can use the standard meal allowance to figure your meal expenses when you travel in connection with investment and other income-producing property. Form 1040 2010 You can also use it to figure your meal expenses when you travel for qualifying educational purposes. Form 1040 2010 You cannot use the standard meal allowance to figure the cost of your meals when you travel for medical or charitable purposes. Form 1040 2010 Amount of standard meal allowance. Form 1040 2010   The standard meal allowance is the federal M&IE rate. Form 1040 2010 For travel in 2013, the rate for most small localities in the United States is $46 a day. Form 1040 2010    Most major cities and many other localities in the United States are designated as high-cost areas, qualifying for higher standard meal allowances. Form 1040 2010    You can find this information (organized by state) on the Internet at www. Form 1040 2010 gsa. Form 1040 2010 gov/perdiem. Form 1040 2010 Enter a zip code or select a city and state for the per diem rates for the current fiscal year. Form 1040 2010 Per diem rates for prior fiscal years are available by using the drop down menu under “Search by State. Form 1040 2010 ”   Per diem rates are listed by the Federal government's fiscal year which runs from October 1 to September 30. Form 1040 2010 You can choose to use the rates from the 2013 fiscal year per diem tables or the rates from the 2014 fiscal year tables, but you must consistently use the same tables for all travel you are reporting on your income tax return for the year. Form 1040 2010   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. Form 1040 2010 If you work in the transportation industry, however, see Special rate for transportation workers , later. Form 1040 2010 Standard meal allowance for areas outside the continental United States. Form 1040 2010   The standard meal allowance rates above do not apply to travel in Alaska, Hawaii, or any other location outside the continental United States. Form 1040 2010 The Department of Defense establishes per diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U. Form 1040 2010 S. Form 1040 2010 Virgin Islands, Wake Island, and other non-foreign areas outside the continental United States. Form 1040 2010 The Department of State establishes per diem rates for all other foreign areas. Form 1040 2010    You can access per diem rates for non-foreign areas outside the continental United States at: www. Form 1040 2010 defensetravel. Form 1040 2010 dod. Form 1040 2010 mil/site/perdiemCalc. Form 1040 2010 cfm. Form 1040 2010 You can access all other foreign per diem rates at: www. Form 1040 2010 state. Form 1040 2010 gov/travel/. Form 1040 2010 Click on “Travel Per Diem Allowances for Foreign Areas,” under “Foreign Per Diem Rates” to obtain the latest foreign per diem rates. Form 1040 2010 Special rate for transportation workers. Form 1040 2010   You can use a special standard meal allowance if you work in the transportation industry. Form 1040 2010 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. Form 1040 2010 If this applies to you, you can claim a standard meal allowance of $59 a day ($65 for travel outside the continental United States). Form 1040 2010   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. Form 1040 2010 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. Form 1040 2010 Travel for days you depart and return. Form 1040 2010   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). Form 1040 2010 You can do so by one of two methods. Form 1040 2010 Method 1: You can claim 3/4 of the standard meal allowance. Form 1040 2010 Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice. Form 1040 2010 Example. Form 1040 2010 Jen is employed in New Orleans as a convention planner. Form 1040 2010 In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. Form 1040 2010 She left her home in New Orleans at 10 a. Form 1040 2010 m. Form 1040 2010 on Wednesday and arrived in Washington, DC, at 5:30 p. Form 1040 2010 m. Form 1040 2010 After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p. Form 1040 2010 m. Form 1040 2010 Jen's employer gave her a flat amount to cover her expenses and included it with her wages. Form 1040 2010 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. Form 1040 2010 Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. Form 1040 2010 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. Form 1040 2010 Travel in the United States The following discussion applies to travel in the United States. Form 1040 2010 For this purpose, the United States includes the 50 states and the District of Columbia. Form 1040 2010 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. Form 1040 2010 See Part of Trip Outside the United States , later. Form 1040 2010 Trip Primarily for Business You can deduct all of your travel expenses if your trip was entirely business related. Form 1040 2010 If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct only your business-related travel expenses. Form 1040 2010 These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination. Form 1040 2010 Example. Form 1040 2010 You work in Atlanta and take a business trip to New Orleans in May. Form 1040 2010 Your business travel totals 850 miles round trip. Form 1040 2010 On your way, you stop in Mobile to visit your parents. Form 1040 2010 You spend $2,120 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. Form 1040 2010 If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,820. Form 1040 2010 You can deduct $1,820 for your trip, including the cost of round-trip transportation to and from New Orleans. Form 1040 2010 The deduction for your meals is subject to the 50% limit on meals mentioned earlier. Form 1040 2010 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. Form 1040 2010 However, you can deduct any expenses you have while at your destination that are directly related to your business. Form 1040 2010 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. Form 1040 2010 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. Form 1040 2010 Part of Trip Outside the United States If part of your trip is outside the United States, use the rules described later in this chapter under Travel Outside the United States for that part of the trip. Form 1040 2010 For the part of your trip that is inside the United States, use the rules for travel in the United States. Form 1040 2010 Travel outside the United States does not include travel from one point in the United States to another point in the United States. Form 1040 2010 The following discussion can help you determine whether your trip was entirely within the United States. Form 1040 2010 Public transportation. Form 1040 2010   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. Form 1040 2010 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 . Form 1040 2010 Example. Form 1040 2010 You fly from New York to Puerto Rico with a scheduled stop in Miami. Form 1040 2010 You return to New York nonstop. Form 1040 2010 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. Form 1040 2010 Because there are no scheduled stops between Puerto Rico and New York, all of the return trip is outside the United States. Form 1040 2010 Private car. Form 1040 2010   Travel by private car in the United States is travel between points in the United States, even though you are on your way to a destination outside the United States. Form 1040 2010 Example. Form 1040 2010 You travel by car from Denver to Mexico City and return. Form 1040 2010 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. Form 1040 2010 The rules under Travel Outside the United States apply to your trip from the border to Mexico City and back to the border. Form 1040 2010 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. Form 1040 2010 For this purpose, the United States includes the 50 states and the District of Columbia. Form 1040 2010 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. Form 1040 2010 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. Form 1040 2010 Travel entirely for business. Form 1040 2010   If you travel outside the United States and you spend the entire time on business activities, you can deduct all of your travel expenses. Form 1040 2010 Travel considered entirely for business. Form 1040 2010   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. Form 1040 2010 Exception 1 - No substantial control. Form 1040 2010   Your trip is considered entirely for business if you did not have substantial control over arranging the trip. Form 1040 2010 The fact that you control the timing of your trip does not, by itself, mean that you have substantial control over arranging your trip. Form 1040 2010   You do not have substantial control over your trip if you: Are an employee who was reimbursed or paid a travel expense allowance, and Are not related to your employer, or Are not a managing executive. Form 1040 2010    “Related to your employer” is defined later in chapter 6 under Per Diem and Car Allowances . Form 1040 2010   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. Form 1040 2010   A self-employed person generally has substantial control over arranging business trips. Form 1040 2010 Exception 2 - Outside United States no more than a week. Form 1040 2010   Your trip is considered entirely for business if you were outside the United States for a week or less, combining business and nonbusiness activities. Form 1040 2010 One week means 7 consecutive days. Form 1040 2010 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. Form 1040 2010 Example. Form 1040 2010 You traveled to Brussels primarily for business. Form 1040 2010 You left Denver on Tuesday and flew to New York. Form 1040 2010 On Wednesday, you flew from New York to Brussels, arriving the next morning. Form 1040 2010 On Thursday and Friday, you had business discussions, and from Saturday until Tuesday, you were sightseeing. Form 1040 2010 You flew back to New York, arriving Wednesday afternoon. Form 1040 2010 On Thursday, you flew back to Denver. Form 1040 2010 Although you were away from your home in Denver for more than a week, you were not outside the United States for more than a week. Form 1040 2010 This is because the day you depart does not count as a day outside the United States. Form 1040 2010 You can deduct your cost of the round-trip flight between Denver and Brussels. Form 1040 2010 You can also deduct the cost of your stay in Brussels for Thursday and Friday while you conducted business. Form 1040 2010 However, you cannot deduct the cost of your stay in Brussels from Saturday through Tuesday because those days were spent on nonbusiness activities. Form 1040 2010 Exception 3 - Less than 25% of time on personal activities. Form 1040 2010   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. Form 1040 2010 For this purpose, count both the day your trip began and the day it ended. Form 1040 2010 Example. Form 1040 2010 You flew from Seattle to Tokyo, where you spent 14 days on business and 5 days on personal matters. Form 1040 2010 You then flew back to Seattle. Form 1040 2010 You spent 1 day flying in each direction. Form 1040 2010 Because only 5/21 (less than 25%) of your total time abroad was for nonbusiness activities, you can deduct as travel expenses what it would have cost you to make the trip if you had not engaged in any nonbusiness activity. Form 1040 2010 The amount you can deduct is the cost of the round-trip plane fare and 16 days of meals (subject to the 50% limit), lodging, and other related expenses. Form 1040 2010 Exception 4 - Vacation not a major consideration. Form 1040 2010   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. Form 1040 2010 Travel Primarily for Business If you travel outside the United States primarily for business but spend some of your time on other activities, you generally cannot deduct all of your travel expenses. Form 1040 2010 You can only deduct the business portion of your cost of getting to and from your destination. Form 1040 2010 You must allocate the costs between your business and other activities to determine your deductible amount. Form 1040 2010 See Travel allocation rules , later. Form 1040 2010 You do not have to allocate your travel expenses if you meet one of the four exceptions listed earlier under Travel considered entirely for business . Form 1040 2010 In those cases, you can deduct the total cost of getting to and from your destination. Form 1040 2010 Travel allocation rules. Form 1040 2010   If your trip outside the United States was primarily for business, you must allocate your travel time on a day-to-day basis between business days and nonbusiness days. Form 1040 2010 The days you depart from and return to the United States are both counted as days outside the United States. Form 1040 2010   To figure the deductible amount of your round-trip travel expenses, use the following fraction. Form 1040 2010 The numerator (top number) is the total number of business days outside the United States. Form 1040 2010 The denominator (bottom number) is the total number of business and nonbusiness days of travel. Form 1040 2010 Counting business days. Form 1040 2010   Your business days include transportation days, days your presence was required, days you spent on business, and certain weekends and holidays. Form 1040 2010 Transportation day. Form 1040 2010   Count as a business day any day you spend traveling to or from a business destination. Form 1040 2010 However, if because of a nonbusiness activity you do not travel by a direct route, your business days are the days it would take you to travel a reasonably direct route to your business destination. Form 1040 2010 Extra days for side trips or nonbusiness activities cannot be counted as business days. Form 1040 2010 Presence required. Form 1040 2010   Count as a business day any day your presence is required at a particular place for a specific business purpose. Form 1040 2010 Count it as a business day even if you spend most of the day on nonbusiness activities. Form 1040 2010 Day spent on business. Form 1040 2010   If your principal activity during working hours is the pursuit of your trade or business, count the day as a business day. Form 1040 2010 Also, count as a business day any day you are prevented from working because of circumstances beyond your control. Form 1040 2010 Certain weekends and holidays. Form 1040 2010   Count weekends, holidays, and other necessary standby days as business days if they fall between business days. Form 1040 2010 But if they follow your business meetings or activity and you remain at your business destination for nonbusiness or personal reasons, do not count them as business days. Form 1040 2010 Example 1. Form 1040 2010 Your tax home is New York City. Form 1040 2010 You travel to Quebec, where you have a business appointment on Friday. Form 1040 2010 You have another appointment on the following Monday. Form 1040 2010 Because your presence was required on both Friday and Monday, they are business days. Form 1040 2010 Because the weekend is between business days, Saturday and Sunday are counted as business days. Form 1040 2010 This is true even though you use the weekend for sightseeing, visiting friends, or other nonbusiness activity. Form 1040 2010 Example 2. Form 1040 2010 If, in Example 1, you had no business in Quebec after Friday, but stayed until Monday before starting home, Saturday and Sunday would be nonbusiness days. Form 1040 2010 Nonbusiness activity on the way to or from your business destination. Form 1040 2010   If you stopped for a vacation or other nonbusiness activity either on the way from the United States to your business destination, or on the way back to the United States from your business destination, you must allocate part of your travel expenses to the nonbusiness activity. Form 1040 2010   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your nonbusiness destination and a return to the point where travel outside the United States ends. Form 1040 2010   You determine the nonbusiness portion of that expense by multiplying it by a fraction. Form 1040 2010 The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. Form 1040 2010 Example. Form 1040 2010 You live in New York. Form 1040 2010 On May 4 you flew to Paris to attend a business conference that began on May 5. Form 1040 2010 The conference ended at noon on May 14. Form 1040 2010 That evening you flew to Dublin where you visited with friends until the afternoon of May 21, when you flew directly home to New York. Form 1040 2010 The primary purpose for the trip was to attend the conference. Form 1040 2010 If you had not stopped in Dublin, you would have arrived home the evening of May 14. Form 1040 2010 You do not meet any of the exceptions that would allow you to consider your travel entirely for business. Form 1040 2010 May 4 through May 14 (11 days) are business days and May 15 through May 21 (7 days) are nonbusiness days. Form 1040 2010 You can deduct the cost of your meals (subject to the 50% limit), lodging, and other business-related travel expenses while in Paris. Form 1040 2010 You cannot deduct your expenses while in Dublin. Form 1040 2010 You also cannot deduct 7/18 of what it would have cost you to travel round-trip between New York and Dublin. Form 1040 2010 You paid $750 to fly from New York to Paris, $400 to fly from Paris to Dublin, and $700 to fly from Dublin back to New York. Form 1040 2010 Round-trip airfare from New York to Dublin would have been $1,250. Form 1040 2010 You figure the deductible part of your air travel expenses by subtracting 7/18 of the round-trip fare and other expenses you would have had in traveling directly between New York and Dublin ($1,250 × 7/18 = $486) from your total expenses in traveling from New York to Paris to Dublin and back to New York ($750 + $400 + $700 = $1,850). Form 1040 2010 Your deductible air travel expense is $1,364 ($1,850 − $486). Form 1040 2010 Nonbusiness activity at, near, or beyond business destination. Form 1040 2010   If you had a vacation or other nonbusiness activity at, near, or beyond your business destination, you must allocate part of your travel expenses to the nonbusiness activity. Form 1040 2010   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your business destination and a return to the point where travel outside the United States ends. Form 1040 2010   You determine the nonbusiness portion of that expense by multiplying it by a fraction. Form 1040 2010 The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. Form 1040 2010   None of your travel expenses for nonbusiness activities at, near, or beyond your business destination are deductible. Form 1040 2010 Example. Form 1040 2010 Assume that the dates are the same as in the previous example but that instead of going to Dublin for your vacation, you fly to Venice, Italy, for a vacation. Form 1040 2010 You cannot deduct any part of the cost of your trip from Paris to Venice and return to Paris. Form 1040 2010 In addition, you cannot deduct 7/18 of the airfare and other expenses from New York to Paris and back to New York. Form 1040 2010 You can deduct 11/18 of the round-trip plane fare and other travel expenses from New York to Paris, plus your meals (subject to the 50% limit), lodging, and any other business expenses you had in Paris. Form 1040 2010 (Assume these expenses total $4,939. Form 1040 2010 ) If the round-trip plane fare and other travel-related expenses (such as food during the trip) are $1,750, you can deduct travel costs of $1,069 (11/18 × $1,750), plus the full $4,939 for the expenses you had in Paris. Form 1040 2010 Other methods. Form 1040 2010   You can use another method of counting business days if you establish that it more clearly reflects the time spent on other than business activities outside the United States. Form 1040 2010 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. Form 1040 2010 However, if you spend some time attending brief professional seminars or a continuing education program, you can deduct your registration fees and other expenses you have that are directly related to your business. Form 1040 2010 Example. Form 1040 2010 The university from which you graduated has a continuing education program for members of its alumni association. Form 1040 2010 This program consists of trips to various foreign countries where academic exercises and conferences are set up to acquaint individuals in most occupations with selected facilities in several regions of the world. Form 1040 2010 However, none of the conferences are directed toward specific occupations or professions. Form 1040 2010 It is up to each participant to seek out specialists and organizational settings appropriate to his or her occupational interests. Form 1040 2010 Three-hour sessions are held each day over a 5-day period at each of the selected overseas facilities where participants can meet with individual practitioners. Form 1040 2010 These sessions are composed of a variety of activities including workshops, mini-lectures, role playing, skill development, and exercises. Form 1040 2010 Professional conference directors schedule and conduct the sessions. Form 1040 2010 Participants can choose those sessions they wish to attend. Form 1040 2010 You can participate in this program since you are a member of the alumni association. Form 1040 2010 You and your family take one of the trips. Form 1040 2010 You spend about 2 hours at each of the planned sessions. Form 1040 2010 The rest of the time you go touring and sightseeing with your family. Form 1040 2010 The trip lasts less than 1 week. Form 1040 2010 Your travel expenses for the trip are not deductible since the trip was primarily a vacation. Form 1040 2010 However, registration fees and any other incidental expenses you have for the five planned sessions you attended that are directly related and beneficial to your business are deductible business expenses. Form 1040 2010 These expenses should be specifically stated in your records to ensure proper allocation of your deductible business expenses. Form 1040 2010 Luxury Water Travel If you travel by ocean liner, cruise ship, or other form of luxury water transportation for business purposes, there is a daily limit on the amount you can deduct. Form 1040 2010 The limit is twice the highest federal per diem rate allowable at the time of your travel. Form 1040 2010 (Generally, the federal per diem is the amount paid to federal government employees for daily living expenses when they travel away from home, but in the United States, for business purposes. Form 1040 2010 ) Daily limit on luxury water travel. Form 1040 2010   The highest federal per diem rate allowed and the daily limit for luxury water travel in 2013 is shown in the following table. Form 1040 2010   2013 Dates Highest Federal Per Diem Daily Limit on Luxury Water Travel   Jan. Form 1040 2010 1 – Mar. Form 1040 2010 31 $367 $734   Apr. Form 1040 2010 1 – June 30 312 624   July 1 – Aug. Form 1040 2010 31 310 620   Sept. Form 1040 2010 1 – Sept. Form 1040 2010 30 366 732   Oct. Form 1040 2010 1 – Dec. Form 1040 2010 31 374 748 Example. Form 1040 2010 Caroline, a travel agent, traveled by ocean liner from New York to London, England, on business in May. Form 1040 2010 Her expense for the 6-day cruise was $5,200. Form 1040 2010 Caroline's deduction for the cruise cannot exceed $3,744 (6 days × $624 daily limit). Form 1040 2010 Meals and entertainment. Form 1040 2010   If your expenses for luxury water travel include separately stated amounts for meals or entertainment, those amounts are subject to the 50% limit on meals and entertainment before you apply the daily limit. Form 1040 2010 For a discussion of the 50% Limit , see chapter 2. Form 1040 2010 Example. Form 1040 2010 In the previous example, Caroline's luxury water travel had a total cost of $5,200. Form 1040 2010 Of that amount, $3,700 was separately stated as meals and entertainment. Form 1040 2010 Caroline, who is self-employed, is not reimbursed for any of her travel expenses. Form 1040 2010 Caroline figures her deductible travel expenses as follows. Form 1040 2010 Meals and entertainment $3,700   50% limit × . Form 1040 2010 50   Allowable meals &     entertainment $1,850   Other travel expenses + 1,800   Allowable cost before the daily limit $3,650 Daily limit for May 2013 $624   Times number of days × 6   Maximum luxury water travel     deduction $3,744 Amount of allowable deduction $3,650 Caroline's deduction for her cruise is limited to $3,650, even though the limit on luxury water travel is slightly higher. Form 1040 2010 Not separately stated. Form 1040 2010   If your meal or entertainment charges are not separately stated or are not clearly identifiable, you do not have to allocate any portion of the total charge to meals or entertainment. Form 1040 2010 Exceptions The daily limit on luxury water travel (discussed earlier) does not apply to expenses you have to attend a convention, seminar, or meeting on board a cruise ship. Form 1040 2010 See Cruise Ships under Conventions. Form 1040 2010 Conventions You can deduct your travel expenses when you attend a convention if you can show that your attendance benefits your trade or business. Form 1040 2010 You cannot deduct the travel expenses for your family. Form 1040 2010 If the convention is for investment, political, social, or other purposes unrelated to your trade or business, you cannot deduct the expenses. Form 1040 2010 Your appointment or election as a delegate does not, in itself, determine whether you can deduct travel expenses. Form 1040 2010 You can deduct your travel expenses only if your attendance is connected to your own trade or business. Form 1040 2010 Convention agenda. Form 1040 2010   The convention agenda or program generally shows the purpose of the convention. Form 1040 2010 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. Form 1040 2010 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. Form 1040 2010 Conventions Held Outside the North American Area You cannot deduct expenses for attending a convention, seminar, or similar meeting held outside the North American area unless: The meeting is directly related to your trade or business, and It is reasonable to hold the meeting outside the North American area. Form 1040 2010 See Reasonableness test , later. Form 1040 2010 If the meeting meets these requirements, you also must satisfy the rules for deducting expenses for business trips in general, discussed earlier under Travel Outside the United States . Form 1040 2010 North American area. Form 1040 2010   The North American area includes the following locations. Form 1040 2010 American Samoa Johnston Island Antigua and Barbuda Kingman Reef Aruba Marshall Islands Bahamas Mexico Baker Island Micronesia Barbados Midway Islands Bermuda Netherlands Antilles Canada Northern Mariana Costa Rica Islands Dominica Palau Dominican Republic Palmyra Atoll Grenada Panama Guam Puerto Rico Guyana Trinidad and Tobago Honduras USA Howland Island U. Form 1040 2010 S. Form 1040 2010 Virgin Islands Jamaica Wake Island Jarvis Island   The North American area also includes U. Form 1040 2010 S. Form 1040 2010 islands, cays, and reefs that are possessions of the United States and not part of the fifty states or the District of Columbia. Form 1040 2010 Reasonableness test. Form 1040 2010   The following factors are taken into account to determine if it was reasonable to hold the meeting outside the North American area. Form 1040 2010 The purpose of the meeting and the activities taking place at the meeting. Form 1040 2010 The purposes and activities of the sponsoring organizations or groups. Form 1040 2010 The homes of the active members of the sponsoring organizations and the places at which other meetings of the sponsoring organizations or groups have been or will be held. Form 1040 2010 Other relevant factors you may present. Form 1040 2010 Cruise Ships You can deduct up to $2,000 per year of your expenses of attending conventions, seminars, or similar meetings held on cruise ships. Form 1040 2010 All ships that sail are considered cruise ships. Form 1040 2010 You can deduct these expenses only if all of the following requirements are met. Form 1040 2010 The convention, seminar, or meeting is directly related to your trade or business. Form 1040 2010 The cruise ship is a vessel registered in the United States. Form 1040 2010 All of the cruise ship's ports of call are in the United States or in possessions of the United States. Form 1040 2010 You attach to your return a written statement signed by you that includes information about: The total days of the trip (not including the days of transportation to and from the cruise ship port), The number of hours each day that you devoted to scheduled business activities, and A program of the scheduled business activities of the meeting. Form 1040 2010 You attach to your return a written statement signed by an officer of the organization or group sponsoring the meeting that includes: A schedule of the business activities of each day of the meeting, and The number of hours you attended the scheduled business activities. Form 1040 2010 Prev  Up  Next   Home   More Online Publications