Question

Kimberly is a self-employed taxpayer. She recently spent $2,700 for airfare to travel to Italy. What amount of the airfare is deductible in each of the following alternative scenarios? On the trip, she spent six days on business activities and four days on personal activities. What is the deductible amount of airfare in each scenario?

Answer 1

If Kimberly's trip to Italy is primarily for business and the personal activities are incidental, she can likely deduct the entire $2,700 for airfare as a business expense.

Step-by-step explanation:

When considering the deduction for a combined business and personal trip, the Internal Revenue Service (IRS) rules state that if the trip is primarily for business and the personal portion is incidental, then the cost of the trip is deductible.

In the scenario where Kimberly spent six days on business activities and four days on personal activities, the trip seems primarily for business. Assuming she works a normal five-day workweek, her spending on business days outweighs personal days. Therefore, the entire $2,700 airfare is likely deductible as a business expense.