Business Trips: What Travel Costs You Can Deduct
The away-from-home test, what counts as a business day, mixing business with vacation, foreign trips, and the per diem option.
Reviewed by the Fairlight Accounting cross-border tax team — U.S. & Canadian Tax Desks
Business travel costs are deductible when you travel away from your tax home — the general area of your main place of business — for substantially longer than an ordinary workday and need sleep or rest. Transportation, lodging, and incidental costs are fully deductible; meals are 50 percent. The trip must be primarily for business.
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What costs are deductible?
| Cost | Deduction |
|---|---|
| Airfare, train, bus, or car to and from the destination | 100% (if trip is primarily business) |
| Lodging on business days | 100% |
| Meals while away | 50% |
| Taxis, rideshares, and local transport at the destination | 100% |
| Baggage, shipping samples, business calls, dry cleaning and laundry | 100% |
| Tips related to deductible services | Same as the service |
| Sightseeing, entertainment, personal side trips | 0% |
How do you count business days?
Days spent working, traveling to the destination, and days when your presence is required count as business days. Weekends, holidays, and other necessary standby days that fall between business days also count, even if you spend them sightseeing. Days you stay on after the business ends, or add for vacation, do not.
If a domestic trip is primarily business, the full round-trip transportation is deductible even if some days are personal; only the personal days' lodging and meals are excluded. If the trip is primarily personal, transportation is not deductible, though business-day expenses at the destination may be.
What is different about foreign travel?
For a trip outside the U.S. that is primarily for business, lasts more than a week, and has nonbusiness days making up 25 percent or more of the time abroad, the cost of getting there and back must be allocated by the ratio of business days to total days. The full transportation deduction is kept if you were outside the U.S. for a week or less (not counting the day you leave), spent less than 25 percent of the time on personal activities, had no substantial control over arranging the trip, or can show a vacation was not a major consideration. Conventions held outside the North American area must pass a reasonableness test, and convention or seminar costs on cruise ships are capped at $2,000 a year.
Can you deduct a spouse's travel?
Only if the spouse is your employee, has a bona fide business purpose for the trip, and the cost would otherwise be deductible. Otherwise, deduct only what you would have spent alone — for example, the single-room rate.
How does the per diem option work?
Self-employed people can use the federal per diem rate for meals and incidental expenses instead of tracking actual meal costs; lodging must still be actual. Employers can reimburse employees at per diem rates under an accountable plan. The 50 percent limit applies to the whole meals-and-incidentals amount, not to lodging.
What records are needed?
For each trip: the amount of each expense, dates of departure and return and the number of business days, destination, business purpose, and receipts for all lodging and for any other expense of $75 or more (a transportation charge with no readily available receipt is excepted). A calendar showing meetings plus receipts usually suffices.
Frequently asked questions
Is a long temporary assignment still travel?
A work assignment realistically expected to last (and that does last) one year or less is temporary, and travel costs are deductible. One realistically expected to last more than a year is indefinite — the location becomes your tax home even if the work ends sooner — and costs there are nondeductible.
Are conferences deductible?
Yes, if they relate to your current business. Registration, travel, and lodging follow the rules above.
Do I need a tax home to deduct travel?
Yes. Someone with no regular or main place of business who also has no main home they keep up and return to is an itinerant — their tax home is wherever they work, so they have no deductible travel.
Can I deduct travel to look at a new business?
Costs of investigating a new business are start-up costs, which follow separate rules.
Official sources
The IRS explains: “Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. It includes the entire city or general area in which your business or work is located.” — Internal Revenue Service, Publication 463 (2025), Travel, Gift, and Car Expenses, https://www.irs.gov/publications/p463
The General Services Administration explains: “We establish the per diem rates that federal agencies use to reimburse their employees for lodging and meals and incidental expenses incurred while on official travel within the continental United States.” — U.S. General Services Administration, Per diem rates, https://www.gsa.gov/travel/plan-book/per-diem-rates
Next step
Fairlight Accounting handles U.S. domestic, cross-border (U.S.–Canada), and international tax returns, plus bookkeeping, payroll, and CFO advisory. Our U.S. Tax Desk separates business and personal days on mixed trips before they reach the return. See pricing or book a free fit call.
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