Tax Deductions and Credits

Your Guide to Vacations and Taxes

Written by Elle Martinez
Published May 24, 2016 - [Updated Jul 10, 2019]
3 min read

Taking the family along on a business trip this summer? Learn how to save on your taxes and take the tax deductions you’re entitled to on your working vacation.

It’s tricky to mix, but with the right mindset and careful planning, you can save big on your next vacation.

Working Vacations

One of the trips we’re taking soon is for a business conference I’m attending in Chicago. We went there years ago and loved it.

My family is coming along, so while I’m getting work done through the day, my husband, mother, and our girls can catch some wonderful spots like the Shedd Aquarium and explore the city.

There will be plenty of time to relax all together in the evenings. To make sure that you and I stay on the right of the IRS, let’s review what you can and cannot deduct when traveling with family.

Business Trips: The Big Does and Don’ts of Tax Deductions

While a few extra days to hang out won’t disqualify my tax deductions, I still have to be careful with what I claim.

Transportation: We’re renting a car and driving up to Chicago. This will be tax deductible since the main purpose is for the conference. If you’re flying to a location, your ticket is tax deductible, but not your family (unless they are employees).
Hotel: Since we’re sharing a room, during the conference this expense is also tax deductible. Again, if we had separate rooms, only mine would be eligible as a business expense. Please also remember that if you’re upgrading your room because of your family, then that’s not deductible.
Meals: Since I’m attending the conference my meals can be deducted (50%), but not my family’s.
Business Expenses: With traveling, you may be hit with some extra expenses like internet at the hotel, dry-cleaning (related to business), and taxis to and from the conference or business meetings.

As long as you claim travel expenses directly related to your business trip and don’t go overboard with your trip expenses you should be fine.

If you’re looking to be smart with your money during vacations, here are some ways you can have a fun trip without going into debt and how to save on vacation taxes.

While you can’t completely write off the trip, it’s nice to claim what you’re entitled to and save some money.

One of the best things you can do, is keep good records and track all of your expenses. If you’re not sure, save your receipts and TurboTax will ask you simple questions related to your business and figure out your business related tax deductions based on your answers when it’s time to file your taxes (enjoy the trip in the meantime!). If you’re self employed you can also use QuickBooks Self-Employed to easily separate your personal expenses from your business expenses and track your tax deductible business expenses year round, which can then be exported directly into TurboTax at tax-time.

Thoughts on Working Vacations and Taxes

How many of you have taken family along when going on a business trip? What have been some of your favorite ways to save? What are some of your favorite spots?

Elle helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second. More from Elle Martinez