One of the most powerful write off business owners can take advantage of are travel expenses. There’s a fine line that you can cross if you’re not aware of what’s a business expense or a personal expense and yes that includes your family.
It is typically not allowed to deduct your travel when you’re traveling with your family, I’m not going to go over the details about how you can include your family in your expenses but I will give you a hint and you can take that one to your CPA.
Hint:
If for example you have your an s-corporation and your spouse and child are on the board of directors, technically you can have your board meetings on an island and take them with you. That’s as much details I’m going to cover about family but so you know there are ways to include family despite what some sources may say out there.
Which brings us to the 5 travel expenses you can deduct, keep in mind this is a website about real estate investing.
- Annual / quarterly corporate meetings.
- Attend a Conference
- Meet with a client
- Shopping for rentals / buy rentals where you travel
- Meet with vendors.
Some people choose to have their corporate meetings in the office other companies choose to have a destination meeting say in an exotic island or someplace the team can really relax and bring forth their creative genius.
Real Estate is a business where you need to keep current with the latest trends on the market, new strategies to make money or simply continue to educate yourself to get the edge in your market. This is a big one, there are several seminars I attend throughout the year and yes you guessed it, all of my expenses are tax deductible during that trip.
Meeting with an existing client or creating a new relationship with a potential investor can be a good one. This is a business which is all about relationships and I encourage you to have as many one on one conversations as possible. Meet with your investors for lunch or take them on a walk through of your latest project.
This is a tricky one because people can go away for a weekend and claim they were looking for investment properties. Looking at properties is not a tax deduction, making offers and eventually purchasing a property is. I’m in a market where properties can be expensive so I recommend some new investors to go out of town to some of the surrounding states where property values are lower and can still provide a nice ROI
This one can be applied to any business including real estate. Some vendors may be out of state and you may occasionally need to visit them to get a good idea of their products, for example if you’re doing a lot of fix and flips during the year and are looking for a new supplier of tiles, counter tops, cabinets etc.. this can be a good one for you.
This list is not all inclusive, these are just some of the write offs I learned from an award winning CPA and best selling author CPA Mark Kholer you can go ahead an learn more about him and his services by clicking his name.
As always I hope this was able to give you an idea on how to plan your next business trip wisely and keep track of your travel expenses, I can tell you this much I no longer have vacations I have business trips. Please comment below and feel free to share this article with your network.
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