J.K. Lasser's Your Income Tax 2015: For Preparing Your 2014 Tax Return

Chapter 20Travel and Entertainment Expense Deductions

Unreimbursed employee travel expenses are deductible but are subject to the 2% of adjusted gross income (AGI) floor (19.1) and may also be subject to the reduction of overall itemized deductions on Schedule A depending on your income (13.6). If you are self-employed, the 2% floor does not apply to travel expenses claimed on Schedule C.

The types of deductible travel expenses are highlighted in Table 20-1. Generally, you must be away from home to deduct travel expenses on overnight business trips, but local lodging costs to attend a business meeting or training required by an employer may also be deductible. Meals and entertainment costs are subject to restrictions, including a 50% deduction limit (20.15). For employees, the 50% limit applies prior to the 2% floor (20.29). On one-day business trips within the general area of your employment, only transportation costs may be deducted; meals may not.

To support your travel expense deductions, keep records that comply with IRS rules (20.26). If you are employed, you can avoid the 2% AGI deduction floor only if your employer maintains an “accountable” reimbursement plan (20.31).

As an emplyee, you report unreimbursed employee transportation and travel expenses on Form 2106. You can use short form 2106-EZ if you are not reimbursed by your company and you do not claim depreciation on a car used for business. Unreimbursed expenses from Form 2106 or 2106-EZ are entered on Schedule ...