How to write-off your travel expenses in your new travel planning business

As a personal travel planner, it is important to know how to properly write off your travel expenses as business expenses. Not only will this help you save money on your taxes, but it will also help to ensure that your business is operating as efficiently as possible. And as your travel host, we always want to make sure you're maximizing your profits.

Standard Deduction & Itemized Deductions

When deciding whether to itemize deductions or take the standard tax deduction, it is important to consider the total amount of your itemized deductions, any significant changes in your financial situation, your state and local taxes, and the impact of the alternative minimum tax (AMT). In general, you should itemize your deductions if your total itemized deductions are greater than the standard tax deduction, but it is a good idea to compare the two options to determine which one will result in a lower tax bill. If you are unsure about which option is best for you, you may want to consult with a tax professional for advice on your specific situation. For the 2022 tax year, the standard deduction is $25,900 for joint filers, $19,400 for heads of household, and $12,950 for single filers and those married filing separately. If your business and travel expenses exceed this number, you should consider itemizing.

DISCLAIMER: Get an accountant. You'll most likely save more than you spend on them, and anyone (including myself) who says they understand our nation's tax code are lying.

Here are some tips on how to write off your travel expenses as a custom travel planner:

Keep good records

In order to write off your travel expenses, you will need to keep good records of your travels. This includes keeping receipts for all of your travel-related expenses, such as flights, hotels, meals, and transportation. You should also keep a detailed itinerary of your travels, including the dates of your trip, the purpose of the trip, and any business meetings or activities that you participated in.

Understand what expenses are deductible

Not all travel expenses are deductible, so it is important to understand what expenses you can and cannot write off. Generally, you can write off any expenses that are directly related to your business, such as transportation costs to and from your clients or business meetings. You can also write off the cost of meals and accommodations while you are on a business trip. Normally, you couldn't write off personal recreational activities, but if you are on those activities in order to recommend them to clients, aren't you "doing research" for your business? Sounds legit to me.

Use the right tax forms

When it comes time to file your taxes, you will need to use the right tax forms to claim your travel expenses. If you are a sole proprietor or single-member LLC, you will need to use Schedule C (Form 1040) to report your business income and expenses. If you are a partnership or multi-member LLC, you will need to use Form 1065 to report your business income and expenses.

Keep track of your home office expenses

If you operate your business from a home office, you may be able to write off a portion of your home office expenses as well. This includes the cost of utilities, insurance, and repairs for your home office space. In order to write off these expenses, you will need to use Form 8829 to calculate the deductible portion of your home office expenses.

Consider using a travel rewards credit card

If you frequently travel for business, it may be beneficial to use a travel rewards credit card to pay for your expenses. Not only will you earn rewards points or miles for your travels, but you will also have a record of all of your business-related expenses in one place. Just be sure to pay off your balance in full each month to avoid accruing interest charges. If you haven't taken the free 10x Travel program course, I highly recommend it. It will turn you into a points generating maniac.

Use a travel expense tracking app

There are a variety of apps available that can help you track your travel expenses in real time. These apps allow you to input your expenses as you go, making it easier to keep track of your receipts and itineraries. Some popular options include Expensify and Concur.

Consult with a tax professional

If you are unsure about which expenses you can write off or how to claim them on your taxes, it is a good idea to consult with a tax professional. A tax professional can help you understand the rules and regulations around writing off travel expenses and ensure that you are taking advantage of all available deductions. For general travel planning non-professional tax advice, feel free to reach out to your Jess.Travel rep.