Question

None of the costs of sightseeing is deductible. However, because her primary purpose for the trip appears to be business (3 days business vs. 2 days personal) she is allowed to deduct her airfare to San Francisco and her other expenses in part a. relating to the business portion of the trip. What expenses can she deduct?

1) All of her sightseeing costs
2) Her airfare to San Francisco and other expenses related to the business portion of the trip
3) None of her expenses
4) Only her airfare to San Francisco

Answer 1

The individual can deduct the cost of airfare for a trip primarily for business to San Francisco, but cannot deduct personal expenses such as sightseeing. Other business-related expenses may be deductible on a prorated basis.

Step-by-step explanation:

When it comes to business trips that also incorporate personal days, the Internal Revenue Service allows for the deduction of travel expenses that are directly related to the business aspect of the trip. In the scenario where the trip is primarily for business purposes, as indicated by the majority of days being allocated to business activities (3 business days versus 2 personal days), the individual can deduct the full cost of their airfare to and from the business destination. This applies to a trip to San Francisco in our case.

However, expenses incurred during personal activities, such as sightseeing costs, are not deductible. The deductibility of other expenses such as lodging and meals is prorated based on the number of business days compared to the total days of the trip. The individual should maintain detailed records and documentation to support the business nature of the expenses claimed for deduction.