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1040a Form To Print

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1040a Form To Print

1040a form to print 12. 1040a form to print   Self-Employment Tax Table of Contents What's New for 2013 What's New for 2014 Introduction Topics - This chapter discusses: Useful Items - You may want to see: Why Pay Self-Employment Tax? How To Pay Self-Employment TaxReplacing a lost social security card. 1040a form to print Name change. 1040a form to print Penalty for underpayment of estimated tax. 1040a form to print Who Must Pay Self-Employment Tax?Limited partner. 1040a form to print Community property. 1040a form to print Figuring Self-Employment EarningsLandlord Participation in Farming Methods for Figuring Net EarningsRegular Method Farm Optional Method Nonfarm Optional Method Using Both Optional Methods Reporting Self-Employment Tax What's New for 2013 Tax rates. 1040a form to print  For tax years beginning in 2013, the social security part of the self-employment tax increases from 10. 1040a form to print 4% to 12. 1040a form to print 4%. 1040a form to print The Medicare part of the tax remains at 2. 1040a form to print 9%. 1040a form to print As a result, the self-employment tax is increased from 13. 1040a form to print 3% to 15. 1040a form to print 3%. 1040a form to print Additional Medicare Tax. 1040a form to print . 1040a form to print  For tax years beginning in 2013, a 0. 1040a form to print 9% Additional Medicare Tax applies to your Medicare wages, Railroad Retirement Tax Act (RRTA) compensation, and self-employment income above a threshold amount. 1040a form to print Use Form 8959, Additional Medicare Tax, to figure this tax. 1040a form to print For more information, see the Instructions for Form 8959. 1040a form to print Maximum net earnings. 1040a form to print  The maximum net self-employment earnings subject to the social security part (12. 1040a form to print 4%) of the self-employment tax increased to $113,700 for 2013. 1040a form to print There is no maximum limit on earnings subject to the Medicare part (2. 1040a form to print 9%). 1040a form to print What's New for 2014 Maximum net earnings. 1040a form to print  The maximum net self-employment earnings subject to the social security part of the self-employment tax for 2014 will be discussed in the 2013 Publication 334. 1040a form to print Introduction Self-employment tax (SE tax) is a social security and Medicare tax primarily for individuals who work for themselves. 1040a form to print It is similar to the social security and Medicare taxes withheld from the pay of most wage earners. 1040a form to print You usually have to pay SE tax if you are self-employed. 1040a form to print You are usually self-employed if you operate your own farm on land you either own or rent. 1040a form to print You have to figure SE tax on Schedule SE (Form 1040). 1040a form to print Farmers who have employees may have to pay the employer's share of social security and Medicare taxes, as well. 1040a form to print See chapter 13 for information on employment taxes. 1040a form to print Self-employment tax rate. 1040a form to print   For tax years beginning in 2013, the self-employment tax rate is 15. 1040a form to print 3%. 1040a form to print The rate consists of two parts: 12. 1040a form to print 4% for social security (old-age, survivors, and disability insurance) and 2. 1040a form to print 9% for Medicare (hospital insurance). 1040a form to print Topics - This chapter discusses: Why pay self-employment tax How to pay self-employment tax Who must pay self-employment tax Figuring self-employment earnings Landlord participation in farming Methods for figuring net earnings Reporting self-employment tax Useful Items - You may want to see: Publication 541 Partnerships Form (and Instructions) 1040 U. 1040a form to print S. 1040a form to print Individual Income Tax Return Sch F (Form 1040) Profit or Loss From Farming Sch SE (Form 1040) Self-Employment Tax 1065 U. 1040a form to print S. 1040a form to print Return of Partnership Income Sch K-1 (Form 1065) Partner's Share of Income, Deductions, Credits, etc. 1040a form to print See chapter 16 for information about getting publications and forms. 1040a form to print Why Pay Self-Employment Tax? Social security benefits are available to self-employed persons just as they are to wage earners. 1040a form to print Your payments of SE tax contribute to your coverage under the social security system. 1040a form to print Social security coverage provides you with retirement benefits, disability benefits, survivor benefits, and hospital insurance (Medicare) benefits. 1040a form to print How to become insured under social security. 1040a form to print   You must be insured under the social security system before you begin receiving social security benefits. 1040a form to print You are insured if you have the required number of credits (also called quarters of coverage). 1040a form to print Earning credits in 2013. 1040a form to print   You can earn a maximum of four credits per year. 1040a form to print For 2013, you earn one credit for each $1,160 of combined wages and self-employment earnings subject to social security tax. 1040a form to print You need $4,640 ($1,160 × 4) of combined wages and self-employment earnings subject to social security tax to earn four credits in 2013. 1040a form to print It does not matter whether the income is earned in 1 quarter or is spread over 2 or more quarters. 1040a form to print For an explanation of the number of credits you must have to be insured and the benefits available to you and your family under the social security program, consult your nearest Social Security Administration (SSA) office or visit the SSA website at www. 1040a form to print socialsecurity. 1040a form to print gov. 1040a form to print Making false statements to get or to increase social security benefits may subject you to penalties. 1040a form to print The Social Security Administration (SSA) time limit for posting self-employment earnings. 1040a form to print   Generally, the SSA will give you credit only for self-employment earnings reported on a tax return filed within 3 years, 3 months, and 15 days after the tax year you earned the income. 1040a form to print    If you file your tax return or report a change in your self-employment earnings after the SSA time limit for posting self-employment earnings, the SSA may change its records, but only to remove or reduce the amount. 1040a form to print The SSA will not change its records to increase your self-employment earnings after the SSA time limit listed above. 1040a form to print How To Pay Self-Employment Tax To pay SE tax, you must have a social security number (SSN) or an individual taxpayer identification number (ITIN). 1040a form to print This section explains how to: Obtain an SSN or ITIN, and Pay your SE tax using estimated tax. 1040a form to print An ITIN does not entitle you to social security benefits. 1040a form to print Obtaining an ITIN does not change your immigration or employment status under U. 1040a form to print S. 1040a form to print law. 1040a form to print Obtaining a social security number. 1040a form to print   If you have never had an SSN, apply for one using Form SS-5, Application for a Social Security Card. 1040a form to print The application is also available in Spanish. 1040a form to print You can get this form at any Social Security office or by calling 1-800-772-1213. 1040a form to print    You can also download Form SS-5 from the Social Security Administration website at  www. 1040a form to print socialsecurity. 1040a form to print gov. 1040a form to print   If you have a social security number from the time you were an employee, you must use that number. 1040a form to print Do not apply for a new one. 1040a form to print Replacing a lost social security card. 1040a form to print   If you have a number but lost your card, file Form SS-5. 1040a form to print You will get a new card showing your original number, not a new number. 1040a form to print Name change. 1040a form to print   If your name has changed since you received your social security card, complete Form SS-5 to report a name change. 1040a form to print Obtaining an individual taxpayer identification number. 1040a form to print   The IRS will issue you an ITIN, for tax use only, if you are a nonresident or resident alien and you do not have, and are not eligible to get, an SSN. 1040a form to print To apply for an ITIN, file Form W-7, Application for IRS Individual Taxpayer Identification Number. 1040a form to print You can get this form by calling 1-800-829-3676. 1040a form to print For more information on ITINs, see Publication 1915, Understanding Your IRS Individual Taxpayer Identification Number. 1040a form to print Form W-7 and Publication 1915 are also available in Spanish. 1040a form to print    You can also download Form W-7 from the IRS website at IRS. 1040a form to print gov. 1040a form to print Paying estimated tax. 1040a form to print   Estimated tax is the method used to pay tax (including SE tax) on income not subject to withholding. 1040a form to print You generally have to make estimated tax payments if you expect to owe tax, including SE tax, of $1,000 or more when you file your return. 1040a form to print Use Form 1040-ES, Estimated Tax for Individuals, to figure and pay the tax. 1040a form to print   However, if at least two-thirds of your gross income for 2013 or 2014 was from farming and you file your 2014 Form 1040 and pay all the tax due by March 2, 2015, you do not have to pay any estimated tax. 1040a form to print For more information about estimated tax for farmers, see chapter 15. 1040a form to print Penalty for underpayment of estimated tax. 1040a form to print   You may have to pay a penalty if you do not pay enough estimated tax by its due date. 1040a form to print Who Must Pay Self-Employment Tax? You must pay SE tax and file Schedule SE (Form 1040) if your net earnings from self-employment were $400 or more. 1040a form to print The SE tax rules apply no matter how old you are and even if you are already receiving social security or Medicare benefits. 1040a form to print Aliens. 1040a form to print   Generally, resident aliens must pay self-employment tax under the same rules that apply to U. 1040a form to print S. 1040a form to print citizens. 1040a form to print Nonresident aliens are not subject to self-employment tax. 1040a form to print However, residents of the Virgin Islands, Puerto Rico, Guam, the Commonwealth of the Northern Mariana Islands, or American Samoa are subject to self-employment tax, as they are considered U. 1040a form to print S. 1040a form to print residents for self-employment tax purposes. 1040a form to print For more information on aliens, see Publication 519, U. 1040a form to print S. 1040a form to print Tax Guide for Aliens. 1040a form to print Are you self-employed?   You are self-employed if you carry on a trade or business (such as running a farm) as a sole proprietor, an independent contractor, a member of a partnership, or are otherwise in business for yourself. 1040a form to print A trade or business is generally an activity carried on for a livelihood or in good faith to make a profit. 1040a form to print Share farmer. 1040a form to print   You are a self-employed farmer under an income-sharing arrangement if both the following apply. 1040a form to print You produce a crop or raise livestock on land belonging to another person. 1040a form to print Your share of the crop or livestock, or the proceeds from their sale, depends on the amount produced. 1040a form to print Your net farm profit or loss from the income-sharing arrangement is reported on Schedule F (Form 1040) and included in your self-employment earnings. 1040a form to print   If you produce a crop or livestock on land belonging to another person and are to receive a specified rate of pay, a fixed sum of money, or a fixed quantity of the crop or livestock, and not a share of the crop or livestock or their proceeds, you may be either self-employed or an employee of the landowner. 1040a form to print This will depend on whether the landowner has the right to direct or control your performance of services. 1040a form to print Example. 1040a form to print A share farmer produces a crop on land owned by another person on a 50-50 crop-share basis. 1040a form to print Under the terms of their agreement, the share farmer furnishes the labor and half the cost of seed and fertilizer. 1040a form to print The landowner furnishes the machinery and equipment used to produce and harvest the crop, and half the cost of seed and fertilizer. 1040a form to print The share farmer is provided a house in which to live. 1040a form to print The landowner and the share farmer decide on a cropping plan. 1040a form to print The share farmer is a self-employed farmer for purposes of the agreement to produce the crops, and the share farmer's part of the profit or loss from the crops is reported on Schedule F (Form 1040) and included in self-employment earnings. 1040a form to print The tax treatment of the landowner is discussed later under Landlord Participation in Farming. 1040a form to print Contract farming. 1040a form to print   Under typical contract farming arrangements, the grower receives a fixed payment per unit of crops or finished livestock delivered to the processor or packing company. 1040a form to print Since the grower typically furnishes labor and bears some production risk, the payments are reported on Schedule F and are therefore subject to self-employment tax. 1040a form to print 4-H Club or FFA project. 1040a form to print   If an individual participates in a 4-H Club or Future Farmers of America (FFA) project, any net income received from sales or prizes related to the project may be subject to income tax. 1040a form to print Report the net income as “Other income” on line 21 of Form 1040. 1040a form to print If necessary, attach a statement showing the gross income and expenses. 1040a form to print The net income may not be subject to SE tax if the project is primarily for educational purposes and not for profit, and is completed by the individual under the rules and economic restrictions of the sponsoring 4-H or FFA organization. 1040a form to print Such a project is generally not considered a trade or business. 1040a form to print Partners in a partnership. 1040a form to print   Generally, you are self-employed if you are a member of a partnership that carries on a trade or business. 1040a form to print Limited partner. 1040a form to print   If you are a limited partner, your partnership income is generally not subject to SE tax. 1040a form to print However, guaranteed payments you receive for services you perform for the partnership are subject to SE tax and should be reported to you in box 14 of your Schedule K-1 (Form 1065). 1040a form to print Business Owned and Operated by Spouses. 1040a form to print   If you and your spouse jointly own and operate a farm as an unincorporated business and share in the profits and losses, you are partners in a partnership whether or not you have a formal partnership agreement. 1040a form to print You must file Form 1065, instead of Schedule F, unless you make a joint election to be treated as a qualified joint venture. 1040a form to print Making this election will allow you to avoid the complexity of Form 1065 but still give each spouse credit for social security earnings on which retirement benefits are based. 1040a form to print Qualified joint venture. 1040a form to print   If you and your spouse each materially participate as the only members of a jointly owned and operated farm, and you file a joint tax return for the tax year, you can make a joint election to be treated as a qualified joint venture instead of a partnership for the tax year. 1040a form to print For an explanation of “material participation,” see the instructions for Schedule C, line G, and the instructions for Schedule F, line E. 1040a form to print   To make this election, you must divide all items of income, gain, loss, deduction, and credit attributable to the business between you and your spouse in accordance with your respective interests in the venture. 1040a form to print Each of you must file a separate Schedule F and a separate Schedule SE. 1040a form to print For more information, see Qualified Joint Venture in the Instructions for Schedule SE (Form 1040). 1040a form to print Spouse employee. 1040a form to print   If your spouse is your employee, not your partner, you must withhold and pay social security and Medicare taxes for him or her. 1040a form to print For more information about employment taxes, see chapter 13. 1040a form to print Community property. 1040a form to print   If you are a partner and your distributive share of any income or loss from a trade or business carried on by the partnership is community property, treat your share as your self-employment earnings. 1040a form to print Do not treat any of your share as self-employment earnings of your spouse. 1040a form to print Figuring Self-Employment Earnings Farmer. 1040a form to print   If you are self-employed as a farmer, use Schedule F (Form 1040) to figure your self-employment earnings. 1040a form to print Partnership income or loss. 1040a form to print   If you are a member of a partnership that carries on a trade or business, the partnership should report your self-employment earnings in box 14, code A, of your Schedule K-1 (Form 1065). 1040a form to print Box 14 of Schedule K-1 may also provide amounts for gross farming or fishing income (code B) and gross nonfarm income (code C). 1040a form to print Use these amounts if you use the farm or nonfarm optional method to figure net earnings from self-employment (see Methods for Figuring Net Earnings , later). 1040a form to print   If you are a general partner, you may need to reduce these reported earnings by amounts you claim as a section 179 deduction, unreimbursed partnership expenses, or depletion on oil and gas properties. 1040a form to print   If the amount reported is a loss, include only the deductible amount when you figure your total self-employment earnings. 1040a form to print   For more information, see the Partner's Instructions for Schedule K-1 (Form 1065). 1040a form to print   For general information on partnerships, see Publication 541. 1040a form to print More than one business. 1040a form to print   If you have self-employment earnings from more than one trade, business, or profession, you generally must combine the net profit or loss from each to determine your total self-employment earnings. 1040a form to print A loss from one business reduces your profit from another business. 1040a form to print However, do not combine earnings from farm and nonfarm businesses if you are using one of the optional methods (discussed later) to figure net earnings. 1040a form to print Community property. 1040a form to print   If any of the income from a farm or business, other than a partnership, is community property under state law, it is included in the self-employment earnings of the spouse carrying on the trade or business. 1040a form to print Lost income payments. 1040a form to print   Lost income payments received from insurance or other sources for reducing or stopping farming activities are included in self-employment earnings. 1040a form to print These include USDA payments to compensate for lost income resulting from reductions in tobacco quotas and allotments. 1040a form to print Even if you are not farming when you receive the payment, it is included in self-employment earnings if it relates to your farm business (even though it is temporarily inactive). 1040a form to print A connection exists if it is clear the payment would not have been made but for your conduct of your farm business. 1040a form to print Gain or loss. 1040a form to print   A gain or loss from the disposition of property that is neither stock in trade nor held primarily for sale to customers is not included in self-employment earnings. 1040a form to print It does not matter whether the disposition is a sale, exchange, or involuntary conversion. 1040a form to print For example, gains or losses from the disposition of the following types of property are not included in self-employment earnings. 1040a form to print Investment property. 1040a form to print Depreciable property or other fixed assets used in your trade or business. 1040a form to print Livestock held for draft, breeding, sport, or dairy purposes, and not held primarily for sale, regardless of how long the livestock was held, or whether it was raised or purchased. 1040a form to print Unharvested standing crops sold with land held more than 1 year. 1040a form to print Timber, coal, or iron ore held for more than 1 year if an economic interest was retained, such as a right to receive coal royalties. 1040a form to print   A gain or loss from the cutting of timber is not included in self-employment earnings if the cutting is treated as a sale or exchange. 1040a form to print For more information on electing to treat the cutting of timber as a sale or exchange, see Timber in chapter 8. 1040a form to print Wages and salaries. 1040a form to print   Wages and salaries received for services performed as an employee and covered by social security or railroad retirement are not included in self-employment earnings. 1040a form to print   Wages paid in kind to you for agricultural labor, such as commodity wages, are not included in self-employment earnings. 1040a form to print Retired partner. 1040a form to print   Retirement income received by a partner from his or her partnership under a written plan is not included in self-employment earnings if all the following apply. 1040a form to print The retired partner performs no services for the partnership during the year. 1040a form to print The retired partner is owed only the retirement payments. 1040a form to print The retired partner's share (if any) of the partnership capital was fully paid to the retired partner. 1040a form to print The payments to the retired partner are lifelong periodic payments. 1040a form to print Conservation Reserve Program (CRP) payments. 1040a form to print   Under the Conservation Reserve Program (CRP), if you own or operate highly erodible or other specified cropland, you may enter into a longterm contract with the USDA, agreeing to convert to a less intensive use of that cropland. 1040a form to print You must include the annual rental payments and any onetime incentive payment you receive under the program on Schedule F, lines 4a and 4b. 1040a form to print Cost share payments you receive may qualify for the costsharing exclusion. 1040a form to print See Cost-Sharing Exclusion (Improvements), above. 1040a form to print CRP payments are reported to you on Form 1099G. 1040a form to print Individuals who are receiving Social Security retirement or disability benefits may exclude CRP payments when calculating self-employment tax. 1040a form to print See the instructions for Schedule SE (Form 1040). 1040a form to print Self-employed health insurance deduction. 1040a form to print   You cannot deduct the self-employed health insurance deduction you report on Form 1040, line 29, from self-employment earnings on Schedule SE (Form 1040). 1040a form to print Landlord Participation in Farming As a general rule, income and deductions from rentals and from personal property leased with real estate are not included in determining self-employment earnings. 1040a form to print However, income and deductions from farm rentals, including government commodity program payments received by a landowner who rents land, are included if the rental arrangement provides that the landowner will, and does, materially participate in the production or management of production of the farm products on the land. 1040a form to print Crop shares. 1040a form to print   Rent paid in the form of crop shares is included in self-employment earnings for the year you sell, exchange, give away, or use the crop shares if you meet one of the four material participation tests (discussed next) at the time the crop shares are produced. 1040a form to print Feeding such crop shares to livestock is considered using them. 1040a form to print Your gross income for figuring your self-employment earnings includes the fair market value of the crop shares when they are used as feed. 1040a form to print Material participation for landlords. 1040a form to print   You materially participate if you have an arrangement with your tenant for your participation and you meet one or more of the following tests. 1040a form to print You do at least three of the following. 1040a form to print Pay, using cash or credit, at least half the direct costs of producing the crop or livestock. 1040a form to print Furnish at least half the tools, equipment, and livestock used in the production activities. 1040a form to print Advise or consult with your tenant. 1040a form to print Inspect the production activities periodically. 1040a form to print You regularly and frequently make, or take an important part in making, management decisions substantially contributing to or affecting the success of the enterprise. 1040a form to print You work 100 hours or more spread over a period of 5 weeks or more in activities connected with agricultural production. 1040a form to print You do things that, considered in their totality, show you are materially and significantly involved in the production of the farm commodities. 1040a form to print These tests may be used as general guides for determining whether you are a material participant. 1040a form to print Example. 1040a form to print Drew Houston agrees to produce a crop on J. 1040a form to print Clarke's cotton farm, with each receiving half the proceeds. 1040a form to print Clarke advises Houston when to plant, spray, and pick the cotton. 1040a form to print During the growing season, Clarke inspects the crop every few days to determine whether Houston is properly taking care of the crop. 1040a form to print Houston furnishes all labor needed to grow and harvest the crop. 1040a form to print The management decisions made by Clarke in connection with the care of the cotton crop and his regular inspection of the crop establish that he participates to a material degree in the cotton production operations. 1040a form to print The income Clarke receives from his cotton farm is included in his self-employment earnings. 1040a form to print Methods for Figuring Net Earnings There are three ways to figure your net earnings from self-employment. 1040a form to print The regular method. 1040a form to print The farm optional method. 1040a form to print The nonfarm optional method. 1040a form to print You must use the regular method unless you are eligible to use one or both of the optional methods. 1040a form to print See Figure 12-1 , shown later. 1040a form to print Figure 12-1. 1040a form to print Can I Use the Optional Methods? Please click here for the text description of the image. 1040a form to print Figure 12–1. 1040a form to print Can I Use the Optional Methods? Why use an optional method?   You may want to use the optional methods (discussed later) when you have a loss or a small net profit and any one of the following applies. 1040a form to print You want to receive credit for social security benefit coverage. 1040a form to print You incurred child or dependent care expenses for which you could claim a credit. 1040a form to print (An optional method may increase your earned income, which could increase your credit. 1040a form to print ) You are entitled to the earned income credit. 1040a form to print (An optional method may increase your earned income, which could increase your credit. 1040a form to print ) You are entitled to the additional child tax credit. 1040a form to print (An optional method may increase your earned income, which could increase your credit. 1040a form to print ) Effects of using an optional method. 1040a form to print   Using an optional method could increase your SE tax. 1040a form to print Paying more SE tax may result in you getting higher social security disability or retirement benefits. 1040a form to print   If you use either or both optional methods, you must figure and pay the SE tax due under these methods even if you would have had a smaller SE tax or no SE tax using the regular method. 1040a form to print   The optional methods may be used only to figure your SE tax. 1040a form to print To figure your income tax, include your actual self-employment earnings in gross income, regardless of which method you use to determine SE tax. 1040a form to print Regular Method Multiply your total self-employment earnings by 92. 1040a form to print 35% (. 1040a form to print 9235) to get your net earnings under the regular method. 1040a form to print See Short Schedule SE, line 4, or Long Schedule SE, line 4a. 1040a form to print Net earnings figured using the regular method are also called “actual net earnings. 1040a form to print ” Farm Optional Method Use the farm optional method only for self-employment earnings from a farming business. 1040a form to print You can use this method if you meet either of the following tests. 1040a form to print Your gross farm income is $6,960 or less. 1040a form to print Your net farm profits are less than $5,024. 1040a form to print Gross farm income. 1040a form to print   Your gross farm income is the total of the amounts from: Schedule F (Form 1040), line 9, and Schedule K-1 (Form 1065), box 14, code B (from farm partnerships). 1040a form to print Net farm profits. 1040a form to print   Net farm profits generally are the total of the amounts from: Schedule F (Form 1040), line 34, and Schedule K-1 (Form 1065), box 14, code A (from farm partnerships). 1040a form to print However, you may need to adjust the amount reported on Schedule K-1 if you are a general partner or if it is a loss. 1040a form to print For more information, see Partnership income or loss , earlier. 1040a form to print Figuring farm net earnings. 1040a form to print   If you meet either of the two tests explained above, use Table 12-1. 1040a form to print Figuring Farm Net Earnings , to figure your net earnings from self-employment under the farm optional method. 1040a form to print Table 12-1. 1040a form to print Figuring Farm Net Earnings IF your gross farm income  is. 1040a form to print . 1040a form to print . 1040a form to print THEN your net earnings are equal to. 1040a form to print . 1040a form to print . 1040a form to print $6,960 or less Two-thirds of your gross farm income. 1040a form to print More than $6,960 $4,640 Optional method can reduce or eliminate SE tax. 1040a form to print   If your gross farm income is $6,960 or less and your farm net earnings figured under the farm optional method are less than your actual net earnings, you can use the farm optional method to reduce or eliminate your SE tax. 1040a form to print Your actual net earnings are your net earnings figured using the regular method, explained earlier. 1040a form to print Example. 1040a form to print Your gross farm income is $540 and your net farm profit is $460. 1040a form to print Consequently, your net earnings figured under the farm optional method are $360 (2/3 of $540) and your actual net earnings are $425 (92. 1040a form to print 35% of $460). 1040a form to print You owe no SE tax if you use the optional method because your net earnings under the farm optional method are less than $400. 1040a form to print Nonfarm Optional Method This is an optional method available for determining net earnings from nonfarm self-employment, much like the farm optional method. 1040a form to print If you are also engaged in a nonfarm business, you may be able to use this method to figure your nonfarm net earnings. 1040a form to print You can use this method even if you do not use the farm optional method for determining your farm net earnings and even if you have a net loss from your nonfarm business. 1040a form to print For more information about the nonfarm optional method, see Publication 334. 1040a form to print You cannot combine farm and nonfarm self-employment earnings to figure your net earnings under either of the optional methods. 1040a form to print Using Both Optional Methods If you use both optional methods, you must add the net earnings figured under each method to arrive at your total net earnings from self-employment. 1040a form to print You can report less than your total actual farm and nonfarm net earnings but not less than actual nonfarm net earnings. 1040a form to print If you use both optional methods, you can report no more than $4,640 as your combined net earnings from self-employment. 1040a form to print Reporting Self-Employment Tax Use Schedule SE (Form 1040) to figure and report your SE tax. 1040a form to print Then, enter the SE tax on line 56 of Form 1040 and attach Schedule SE to Form 1040. 1040a form to print Most taxpayers can use Section A–Short Schedule SE to figure their SE tax. 1040a form to print However, certain taxpayers must use Section B–Long Schedule SE. 1040a form to print Use the chart on page 1 of Schedule SE to find out which one to use. 1040a form to print If you have to pay SE tax, you must file Form 1040 (with Schedule SE attached) even if you do not otherwise have to file a federal income tax return. 1040a form to print Deduction for employer-equivalent portion of self-employment tax. 1040a form to print   You can deduct the employer-equivalent portion of your SE tax in figuring your adjusted gross income. 1040a form to print This deduction only affects your income tax. 1040a form to print It does not affect either your net earnings from self-employment or your SE tax. 1040a form to print   To deduct the tax, enter on Form 1040, line 27, the amount shown on Section A, Line 6, or Section B, line 13, Deduction for employer-equivalent portion of self-employment tax, of the Schedule SE. 1040a form to print Joint return. 1040a form to print   Even if you file a joint return, you cannot file a joint Schedule SE. 1040a form to print This is true whether one spouse or both spouses have self-employment earnings. 1040a form to print Your spouse is not considered self-employed just because you are. 1040a form to print If both of you have self-employment earnings, each of you must complete a separate Schedule SE. 1040a form to print However, if one spouse uses the Short Schedule SE and the other spouse has to use the Long Schedule SE, both can use the same form. 1040a form to print Attach both schedules to the joint return. 1040a form to print If you and your spouse operate a business as a partnership, see Business Owned and Operated by Spouses and Qualified joint venture , earlier, under Who Must Pay Self-Employment Tax . 1040a form to print Prev  Up  Next   Home   More Online Publications
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Contact My Local Office in Alabama

Face-to-face Tax Help

IRS Taxpayer Assistance Centers (TACs) are your source for personal tax help when you believe your tax issue can only be handled face-to-face. No appointment is necessary.

Keep in mind, many questions can be resolved online without waiting in line. Through IRS.gov you can:
• Set up a payment plan.
• Get a transcript of your tax return.
• Make a payment.
• Check on your refund.
• Find answers to many of your tax questions.

We are now referring all requests for tax return preparation services to other available resources. You can take advantage of free tax preparation through Free File, Free File Fillable Forms or through a volunteer site in your community. To find the nearest volunteer site location or to get more information about Free File, go to the top of the page and enter “Free Tax Help” in the Search box.

If you have a tax account issues and feel that it requires talking with someone face-to-face, visit your local TAC.

Caution:  Many of our offices are located in Federal Office Buildings. These buildings may not allow visitors to bring in cell phones with camera capabilities.

Multilingual assistance is available in every office. Hours of operation are subject to change.

Before visiting your local office click on "Services Provided" in the chart below to see what services are available. Services are limited and not all services are available at every TAC office and may vary from site to site. You can get these services on a walk-in basis.

 

City  Address  Days/Hours of Service  Telephone* 
Birmingham  801 Tom Martin Dr.
Birmingham, AL 35211 

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

**This office will be open until 6:00 p.m. on 4/14 & 4/15**

 

Services Provided

(205) 912-5333 
Dothan  202 W. Adams St.
Dothan, AL 36303 

Monday-Friday - 8:30 a.m.-4:30 p.m. 
(Closed for lunch 12:00 noon - 1:00 p.m.)
 

Services Provided

(334) 702-3470 
Florence  204 S. Walnut St.
Florence, AL 35630 

Monday-Friday - 8:30 a.m.-4:30 p.m.
(Closed for lunch 12:00 noon - 1:00 p.m.) 


Services Provided

(256) 764-6731 
Huntsville  5123 Research Dr. N.W.
Huntsville, AL 35805

Monday-Friday - 8:30 a.m.-4:30 p.m.
 

**This office will be open until 6:00 p.m. on 4/14 & 4/15**

 

Services Provided

(256) 539-0642 
Mobile  1110 Montlimar Dr.
Mobile, AL 36609 

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

**This office will be open until 6:00 p.m. on 4/14 & 4/15**
 

Services Provided

(251) 341-5946 
Montgomery  1285 Carmichael Way.
Montgomery, AL 36106 

Monday-Friday - 8:30 a.m.-4:30 p.m.

 

**This office will be open until 6:00 p.m. on 4/14 & 4/15**
 

Services Provided

(334) 264-2453 

* Note: The phone numbers in the chart above are not toll-free for all locations. When you call, you will reach a recorded business message with information about office hours, locations and services provided in that office. If face-to-face assistance is not a priority for you, you may also get help with IRS letters or resolve tax account issues by phone, toll free at 1-800-829-1040 (individuals) or 1-800-829-4933 (businesses).

For information on where to file your tax return please see Where to File Addresses.
 

The Taxpayer Advocate Service: Call (205) 912-5631 in Birmingham, or 1-877-777-4778 elsewhere, or see Publication 1546, The Taxpayer Advocate Service of the IRS. For further information, see Tax Topic 104.

Partnerships

IRS and organizations all over the country are partnering to assist taxpayers. Through these partnerships, organizations are also achieving their own goals. These mutually beneficial partnerships are strengthening outreach efforts and bringing education and assistance to millions.

For more information about these programs for individuals and families, contact the Stakeholder Partnerships, Education and Communication Office at:

Internal Revenue Service
801 Tom Martin, Room 150, Stop 30
Birmingham, AL 35211

For more information about these programs for businesses, your local Stakeholder Liaison office establishes relationships with organizations representing small business and self-employed taxpayers. They provide information about the policies, practices and procedures the IRS uses to ensure compliance with the tax laws. To establish a relationship with us, use this list to find a contact in your state:

Stakeholder Liaison (SL) Phone Numbers for Organizations Representing Small Businesses and Self-employed Taxpayers.

 

Page Last Reviewed or Updated: 28-Mar-2014

The 1040a Form To Print

1040a form to print 1. 1040a form to print   Travel Table of Contents Traveling Away From HomeTax Home Tax Home Different From Family Home Temporary Assignment or Job What Travel Expenses Are Deductible?Employee. 1040a form to print Business associate. 1040a form to print Bona fide business purpose. 1040a form to print Meals Travel in the United States Travel Outside the United States Luxury Water Travel Conventions If you temporarily travel away from your tax home, you can use this chapter to determine if you have deductible travel expenses. 1040a form to print This chapter discusses: Traveling away from home, Temporary assignment or job, and What travel expenses are deductible. 1040a form to print It also discusses the standard meal allowance, rules for travel inside and outside the United States, luxury water travel, and deductible convention expenses. 1040a form to print Travel expenses defined. 1040a form to print   For tax purposes, travel expenses are the ordinary and necessary expenses of traveling away from home for your business, profession, or job. 1040a form to print   An ordinary expense is one that is common and accepted in your trade or business. 1040a form to print A necessary expense is one that is helpful and appropriate for your business. 1040a form to print An expense does not have to be required to be considered necessary. 1040a form to print   You will find examples of deductible travel expenses in Table 1-1 , later. 1040a form to print Traveling Away From Home You are traveling away from home if: Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work, and You need to sleep or rest to meet the demands of your work while away from home. 1040a form to print This rest requirement is not satisfied by merely napping in your car. 1040a form to print You do not have to be away from your tax home for a whole day or from dusk to dawn as long as your relief from duty is long enough to get necessary sleep or rest. 1040a form to print Example 1. 1040a form to print You are a railroad conductor. 1040a form to print You leave your home terminal on a regularly scheduled round-trip run between two cities and return home 16 hours later. 1040a form to print During the run, you have 6 hours off at your turnaround point where you eat two meals and rent a hotel room to get necessary sleep before starting the return trip. 1040a form to print You are considered to be away from home. 1040a form to print Example 2. 1040a form to print You are a truck driver. 1040a form to print You leave your terminal and return to it later the same day. 1040a form to print You get an hour off at your turnaround point to eat. 1040a form to print Because you are not off to get necessary sleep and the brief time off is not an adequate rest period, you are not traveling away from home. 1040a form to print Members of the Armed Forces. 1040a form to print   If you are a member of the U. 1040a form to print S. 1040a form to print Armed Forces on a permanent duty assignment overseas, you are not traveling away from home. 1040a form to print You cannot deduct your expenses for meals and lodging. 1040a form to print You cannot deduct these expenses even if you have to maintain a home in the United States for your family members who are not allowed to accompany you overseas. 1040a form to print If you are transferred from one permanent duty station to another, you may have deductible moving expenses, which are explained in Publication 521, Moving Expenses. 1040a form to print   A naval officer assigned to permanent duty aboard a ship that has regular eating and living facilities has a tax home (explained next) aboard the ship for travel expense purposes. 1040a form to print Tax Home To determine whether you are traveling away from home, you must first determine the location of your tax home. 1040a form to print Generally, your tax home is your regular place of business or post of duty, regardless of where you maintain your family home. 1040a form to print It includes the entire city or general area in which your business or work is located. 1040a form to print If you have more than one regular place of business, your tax home is your main place of business. 1040a form to print See Main place of business or work , later. 1040a form to print If you do not have a regular or a main place of business because of the nature of your work, then your tax home may be the place where you regularly live. 1040a form to print See No main place of business or work , later. 1040a form to print If you do not have a regular or main place of business or post of duty and there is no place where you regularly live, you are considered an itinerant (a transient) and your tax home is wherever you work. 1040a form to print As an itinerant, you cannot claim a travel expense deduction because you are never considered to be traveling away from home. 1040a form to print Main place of business or work. 1040a form to print   If you have more than one place of work, consider the following when determining which one is your main place of business or work. 1040a form to print The total time you ordinarily spend in each place. 1040a form to print The level of your business activity in each place. 1040a form to print Whether your income from each place is significant or insignificant. 1040a form to print Example. 1040a form to print You live in Cincinnati where you have a seasonal job for 8 months each year and earn $40,000. 1040a form to print You work the other 4 months in Miami, also at a seasonal job, and earn $15,000. 1040a form to print Cincinnati is your main place of work because you spend most of your time there and earn most of your income there. 1040a form to print No main place of business or work. 1040a form to print   You may have a tax home even if you do not have a regular or main place of work. 1040a form to print Your tax home may be the home where you regularly live. 1040a form to print Factors used to determine tax home. 1040a form to print   If you do not have a regular or main place of business or work, use the following three factors to determine where your tax home is. 1040a form to print You perform part of your business in the area of your main home and use that home for lodging while doing business in the area. 1040a form to print You have living expenses at your main home that you duplicate because your business requires you to be away from that home. 1040a form to print You have not abandoned the area in which both your historical place of lodging and your claimed main home are located; you have a member or members of your family living at your main home; or you often use that home for lodging. 1040a form to print   If you satisfy all three factors, your tax home is the home where you regularly live. 1040a form to print If you satisfy only two factors, you may have a tax home depending on all the facts and circumstances. 1040a form to print If you satisfy only one factor, you are an itinerant; your tax home is wherever you work and you cannot deduct travel expenses. 1040a form to print Example 1. 1040a form to print You are single and live in Boston in an apartment you rent. 1040a form to print You have worked for your employer in Boston for a number of years. 1040a form to print Your employer enrolls you in a 12-month executive training program. 1040a form to print You do not expect to return to work in Boston after you complete your training. 1040a form to print During your training, you do not do any work in Boston. 1040a form to print Instead, you receive classroom and on-the-job training throughout the United States. 1040a form to print You keep your apartment in Boston and return to it frequently. 1040a form to print You use your apartment to conduct your personal business. 1040a form to print You also keep up your community contacts in Boston. 1040a form to print When you complete your training, you are transferred to Los Angeles. 1040a form to print You do not satisfy factor (1) because you did not work in Boston. 1040a form to print You satisfy factor (2) because you had duplicate living expenses. 1040a form to print You also satisfy factor (3) because you did not abandon your apartment in Boston as your main home, you kept your community contacts, and you frequently returned to live in your apartment. 1040a form to print Therefore, you have a tax home in Boston. 1040a form to print Example 2. 1040a form to print You are an outside salesperson with a sales territory covering several states. 1040a form to print Your employer's main office is in Newark, but you do not conduct any business there. 1040a form to print Your work assignments are temporary, and you have no way of knowing where your future assignments will be located. 1040a form to print You have a room in your married sister's house in Dayton. 1040a form to print You stay there for one or two weekends a year, but you do no work in the area. 1040a form to print You do not pay your sister for the use of the room. 1040a form to print You do not satisfy any of the three factors listed earlier. 1040a form to print You are an itinerant and have no tax home. 1040a form to print Tax Home Different From Family Home If you (and your family) do not live at your tax home (defined earlier), you cannot deduct the cost of traveling between your tax home and your family home. 1040a form to print You also cannot deduct the cost of meals and lodging while at your tax home. 1040a form to print See Example 1 , later. 1040a form to print If you are working temporarily in the same city where you and your family live, you may be considered as traveling away from home. 1040a form to print See Example 2 , later. 1040a form to print Example 1. 1040a form to print You are a truck driver and you and your family live in Tucson. 1040a form to print You are employed by a trucking firm that has its terminal in Phoenix. 1040a form to print At the end of your long runs, you return to your home terminal in Phoenix and spend one night there before returning home. 1040a form to print You cannot deduct any expenses you have for meals and lodging in Phoenix or the cost of traveling from Phoenix to Tucson. 1040a form to print This is because Phoenix is your tax home. 1040a form to print Example 2. 1040a form to print Your family home is in Pittsburgh, where you work 12 weeks a year. 1040a form to print The rest of the year you work for the same employer in Baltimore. 1040a form to print In Baltimore, you eat in restaurants and sleep in a rooming house. 1040a form to print Your salary is the same whether you are in Pittsburgh or Baltimore. 1040a form to print Because you spend most of your working time and earn most of your salary in Baltimore, that city is your tax home. 1040a form to print You cannot deduct any expenses you have for meals and lodging there. 1040a form to print However, when you return to work in Pittsburgh, you are away from your tax home even though you stay at your family home. 1040a form to print You can deduct the cost of your round trip between Baltimore and Pittsburgh. 1040a form to print You can also deduct your part of your family's living expenses for meals and lodging while you are living and working in Pittsburgh. 1040a form to print Temporary Assignment or Job You may regularly work at your tax home and also work at another location. 1040a form to print It may not be practical to return to your tax home from this other location at the end of each work day. 1040a form to print Temporary assignment vs. 1040a form to print indefinite assignment. 1040a form to print   If your assignment or job away from your main place of work is temporary, your tax home does not change. 1040a form to print You are considered to be away from home for the whole period you are away from your main place of work. 1040a form to print You can deduct your travel expenses if they otherwise qualify for deduction. 1040a form to print Generally, a temporary assignment in a single location is one that is realistically expected to last (and does in fact last) for 1 year or less. 1040a form to print    However, if your assignment or job is indefinite, the location of the assignment or job becomes your new tax home and you cannot deduct your travel expenses while there. 1040a form to print An assignment or job in a single location is considered indefinite if it is realistically expected to last for more than 1 year, whether or not it actually lasts for more than 1 year. 1040a form to print   If your assignment is indefinite, you must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances and you account to your employer for them. 1040a form to print You may be able to deduct the cost of relocating to your new tax home as a moving expense. 1040a form to print See Publication 521 for more information. 1040a form to print Exception for federal crime investigations or prosecutions. 1040a form to print   If you are a federal employee participating in a federal crime investigation or prosecution, you are not subject to the 1-year rule. 1040a form to print This means you may be able to deduct travel expenses even if you are away from your tax home for more than 1 year provided you meet the other requirements for deductibility. 1040a form to print   For you to qualify, the Attorney General (or his or her designee) must certify that you are traveling: For the federal government, In a temporary duty status, and To investigate, prosecute, or provide support services for the investigation or prosecution of a federal crime. 1040a form to print Determining temporary or indefinite. 1040a form to print   You must determine whether your assignment is temporary or indefinite when you start work. 1040a form to print If you expect an assignment or job to last for 1 year or less, it is temporary unless there are facts and circumstances that indicate otherwise. 1040a form to print An assignment or job that is initially temporary may become indefinite due to changed circumstances. 1040a form to print A series of assignments to the same location, all for short periods but that together cover a long period, may be considered an indefinite assignment. 1040a form to print   The following examples illustrate whether an assignment or job is temporary or indefinite. 1040a form to print Example 1. 1040a form to print You are a construction worker. 1040a form to print You live and regularly work in Los Angeles. 1040a form to print You are a member of a trade union in Los Angeles that helps you get work in the Los Angeles area. 1040a form to print Your tax home is Los Angeles. 1040a form to print Because of a shortage of work, you took a job on a construction project in Fresno. 1040a form to print Your job was scheduled to end in 8 months. 1040a form to print The job actually lasted 10 months. 1040a form to print You realistically expected the job in Fresno to last 8 months. 1040a form to print The job actually did last less than 1 year. 1040a form to print The job is temporary and your tax home is still in Los Angeles. 1040a form to print Example 2. 1040a form to print The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 18 months. 1040a form to print The job actually was completed in 10 months. 1040a form to print Your job in Fresno is indefinite because you realistically expected the work to last longer than 1 year, even though it actually lasted less than 1 year. 1040a form to print You cannot deduct any travel expenses you had in Fresno because Fresno became your tax home. 1040a form to print Example 3. 1040a form to print The facts are the same as in Example 1, except that you realistically expected the work in Fresno to last 9 months. 1040a form to print After 8 months, however, you were asked to remain for 7 more months (for a total actual stay of 15 months). 1040a form to print Initially, you realistically expected the job in Fresno to last for only 9 months. 1040a form to print However, due to changed circumstances occurring after 8 months, it was no longer realistic for you to expect that the job in Fresno would last for 1 year or less. 1040a form to print You can only deduct your travel expenses for the first 8 months. 1040a form to print You cannot deduct any travel expenses you had after that time because Fresno became your tax home when the job became indefinite. 1040a form to print Going home on days off. 1040a form to print   If you go back to your tax home from a temporary assignment on your days off, you are not considered away from home while you are in your hometown. 1040a form to print You cannot deduct the cost of your meals and lodging there. 1040a form to print However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home. 1040a form to print You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. 1040a form to print   If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. 1040a form to print In addition, you can deduct your expenses of returning home up to the amount you would have spent for meals had you stayed at your temporary place of work. 1040a form to print Probationary work period. 1040a form to print   If you take a job that requires you to move, with the understanding that you will keep the job if your work is satisfactory during a probationary period, the job is indefinite. 1040a form to print You cannot deduct any of your expenses for meals and lodging during the probationary period. 1040a form to print What Travel Expenses Are Deductible? Once you have determined that you are traveling away from your tax home, you can determine what travel expenses are deductible. 1040a form to print You can deduct ordinary and necessary expenses you have when you travel away from home on business. 1040a form to print The type of expense you can deduct depends on the facts and your circumstances. 1040a form to print Table 1-1 summarizes travel expenses you may be able to deduct. 1040a form to print You may have other deductible travel expenses that are not covered there, depending on the facts and your circumstances. 1040a form to print When you travel away from home on business, you should keep records of all the expenses you have and any advances you receive from your employer. 1040a form to print You can use a log, diary, notebook, or any other written record to keep track of your expenses. 1040a form to print The types of expenses you need to record, along with supporting documentation, are described in Table 5-1 (see chapter 5). 1040a form to print Separating costs. 1040a form to print   If you have one expense that includes the costs of meals, entertainment, and other services (such as lodging or transportation), you must allocate that expense between the cost of meals and entertainment and the cost of other services. 1040a form to print You must have a reasonable basis for making this allocation. 1040a form to print For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. 1040a form to print Travel expenses for another individual. 1040a form to print    If a spouse, dependent, or other individual goes with you (or your employee) on a business trip or to a business convention, you generally cannot deduct his or her travel expenses. 1040a form to print Employee. 1040a form to print   You can deduct the travel expenses of someone who goes with you if that person: Is your employee, Has a bona fide business purpose for the travel, and Would otherwise be allowed to deduct the travel expenses. 1040a form to print Business associate. 1040a form to print   If a business associate travels with you and meets the conditions in (2) and (3), earlier, you can deduct the travel expenses you have for that person. 1040a form to print A business associate is someone with whom you could reasonably expect to actively conduct business. 1040a form to print A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor. 1040a form to print Bona fide business purpose. 1040a form to print   A bona fide business purpose exists if you can prove a real business purpose for the individual's presence. 1040a form to print Incidental services, such as typing notes or assisting in entertaining customers, are not enough to make the expenses deductible. 1040a form to print Table 1-1. 1040a form to print Travel Expenses You Can Deduct   This chart summarizes expenses you can deduct when you travel away from home for business purposes. 1040a form to print IF you have expenses for. 1040a form to print . 1040a form to print . 1040a form to print THEN you can deduct the cost of. 1040a form to print . 1040a form to print . 1040a form to print transportation travel by airplane, train, bus, or car between your home and your business destination. 1040a form to print If you were provided with a free ticket or you are riding free as a result of a frequent traveler or similar program, your cost is zero. 1040a form to print If you travel by ship, see Luxury Water Travel and Cruise Ships (under Conventions) for additional rules and limits. 1040a form to print taxi, commuter bus, and airport limousine fares for these and other types of transportation that take you between: The airport or station and your hotel, and The hotel and the work location of your customers or clients, your business meeting place, or your temporary work location. 1040a form to print baggage and shipping sending baggage and sample or display material between your regular and temporary work locations. 1040a form to print car operating and maintaining your car when traveling away from home on business. 1040a form to print You can deduct actual expenses or the standard mileage rate, as well as business-related tolls and parking. 1040a form to print If you rent a car while away from home on business, you can deduct only the business-use portion of the expenses. 1040a form to print lodging and meals your lodging and meals if your business trip is overnight or long enough that you need to stop for sleep or rest to properly perform your duties. 1040a form to print Meals include amounts spent for food, beverages, taxes, and related tips. 1040a form to print See Meals for additional rules and limits. 1040a form to print cleaning dry cleaning and laundry. 1040a form to print telephone business calls while on your business trip. 1040a form to print This includes business communication by fax machine or other communication devices. 1040a form to print tips tips you pay for any expenses in this chart. 1040a form to print other other similar ordinary and necessary expenses related to your business travel. 1040a form to print These expenses might include transportation to or from a business meal, public stenographer's fees, computer rental fees, and operating and maintaining a house trailer. 1040a form to print Example. 1040a form to print Jerry drives to Chicago on business and takes his wife, Linda, with him. 1040a form to print Linda is not Jerry's employee. 1040a form to print Linda occasionally types notes, performs similar services, and accompanies Jerry to luncheons and dinners. 1040a form to print The performance of these services does not establish that her presence on the trip is necessary to the conduct of Jerry's business. 1040a form to print Her expenses are not deductible. 1040a form to print Jerry pays $199 a day for a double room. 1040a form to print A single room costs $149 a day. 1040a form to print He can deduct the total cost of driving his car to and from Chicago, but only $149 a day for his hotel room. 1040a form to print If he uses public transportation, he can deduct only his fare. 1040a form to print Meals You can deduct the cost of meals in either of the following situations. 1040a form to print It is necessary for you to stop for substantial sleep or rest to properly perform your duties while traveling away from home on business. 1040a form to print The meal is business-related entertainment. 1040a form to print Business-related entertainment is discussed in chapter 2 . 1040a form to print The following discussion deals only with meals that are not business-related entertainment. 1040a form to print Lavish or extravagant. 1040a form to print   You cannot deduct expenses for meals that are lavish or extravagant. 1040a form to print An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. 1040a form to print Expenses will not be disallowed merely because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. 1040a form to print 50% limit on meals. 1040a form to print   You can figure your meals expense using either of the following methods. 1040a form to print Actual cost. 1040a form to print The standard meal allowance. 1040a form to print Both of these methods are explained below. 1040a form to print But, regardless of the method you use, you generally can deduct only 50% of the unreimbursed cost of your meals. 1040a form to print   If you are reimbursed for the cost of your meals, how you apply the 50% limit depends on whether your employer's reimbursement plan was accountable or nonaccountable. 1040a form to print If you are not reimbursed, the 50% limit applies whether the unreimbursed meal expense is for business travel or business entertainment. 1040a form to print Chapter 2 discusses the 50% Limit in more detail, and chapter 6 discusses accountable and nonaccountable plans. 1040a form to print Actual Cost You can use the actual cost of your meals to figure the amount of your expense before reimbursement and application of the 50% deduction limit. 1040a form to print If you use this method, you must keep records of your actual cost. 1040a form to print Standard Meal Allowance Generally, you can use the “standard meal allowance” method as an alternative to the actual cost method. 1040a form to print It allows you to use a set amount for your daily meals and incidental expenses (M&IE), instead of keeping records of your actual costs. 1040a form to print The set amount varies depending on where and when you travel. 1040a form to print In this publication, “standard meal allowance” refers to the federal rate for M&IE, discussed later under Amount of standard meal allowance . 1040a form to print If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel. 1040a form to print See the recordkeeping rules for travel in chapter 5 . 1040a form to print Incidental expenses. 1040a form to print   The term “incidental expenses” means fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. 1040a form to print   Incidental expenses do not include expenses for laundry, cleaning and pressing of clothing, lodging taxes, costs of telegrams or telephone calls, transportation between places of lodging or business and places where meals are taken, or the mailing cost of filing travel vouchers and paying employer-sponsored charge card billings. 1040a form to print Incidental-expenses-only method. 1040a form to print   You can use an optional method (instead of actual cost) for deducting incidental expenses only. 1040a form to print The amount of the deduction is $5 a day. 1040a form to print You can use this method only if you did not pay or incur any meal expenses. 1040a form to print You cannot use this method on any day that you use the standard meal allowance. 1040a form to print This method is subject to the proration rules for partial days. 1040a form to print See Travel for days you depart and return , later in this chapter. 1040a form to print Note. 1040a form to print The incidental-expenses-only method is not subject to the 50% limit discussed below. 1040a form to print Federal employees should refer to the Federal Travel Regulations at www. 1040a form to print gsa. 1040a form to print gov. 1040a form to print Find the “Most Requested Links” on the upper left and click on “Regulations: FAR, FMR, FTR” for Federal Travel Regulation (FTR) for changes affecting claims for reimbursement. 1040a form to print 50% limit may apply. 1040a form to print   If you use the standard meal allowance method for meal expenses and you are not reimbursed or you are reimbursed under a nonaccountable plan, you can generally deduct only 50% of the standard meal allowance. 1040a form to print If you are reimbursed under an accountable plan and you are deducting amounts that are more than your reimbursements, you can deduct only 50% of the excess amount. 1040a form to print The 50% limit is discussed in more detail in chapter 2, and accountable and nonaccountable plans are discussed in chapter 6. 1040a form to print There is no optional standard lodging amount similar to the standard meal allowance. 1040a form to print Your allowable lodging expense deduction is your actual cost. 1040a form to print Who can use the standard meal allowance. 1040a form to print   You can use the standard meal allowance whether you are an employee or self-employed, and whether or not you are reimbursed for your traveling expenses. 1040a form to print Use of the standard meal allowance for other travel. 1040a form to print   You can use the standard meal allowance to figure your meal expenses when you travel in connection with investment and other income-producing property. 1040a form to print You can also use it to figure your meal expenses when you travel for qualifying educational purposes. 1040a form to print You cannot use the standard meal allowance to figure the cost of your meals when you travel for medical or charitable purposes. 1040a form to print Amount of standard meal allowance. 1040a form to print   The standard meal allowance is the federal M&IE rate. 1040a form to print For travel in 2013, the rate for most small localities in the United States is $46 a day. 1040a form to print    Most major cities and many other localities in the United States are designated as high-cost areas, qualifying for higher standard meal allowances. 1040a form to print    You can find this information (organized by state) on the Internet at www. 1040a form to print gsa. 1040a form to print gov/perdiem. 1040a form to print Enter a zip code or select a city and state for the per diem rates for the current fiscal year. 1040a form to print Per diem rates for prior fiscal years are available by using the drop down menu under “Search by State. 1040a form to print ”   Per diem rates are listed by the Federal government's fiscal year which runs from October 1 to September 30. 1040a form to print You can choose to use the rates from the 2013 fiscal year per diem tables or the rates from the 2014 fiscal year tables, but you must consistently use the same tables for all travel you are reporting on your income tax return for the year. 1040a form to print   If you travel to more than one location in one day, use the rate in effect for the area where you stop for sleep or rest. 1040a form to print If you work in the transportation industry, however, see Special rate for transportation workers , later. 1040a form to print Standard meal allowance for areas outside the continental United States. 1040a form to print   The standard meal allowance rates above do not apply to travel in Alaska, Hawaii, or any other location outside the continental United States. 1040a form to print The Department of Defense establishes per diem rates for Alaska, Hawaii, Puerto Rico, American Samoa, Guam, Midway, the Northern Mariana Islands, the U. 1040a form to print S. 1040a form to print Virgin Islands, Wake Island, and other non-foreign areas outside the continental United States. 1040a form to print The Department of State establishes per diem rates for all other foreign areas. 1040a form to print    You can access per diem rates for non-foreign areas outside the continental United States at: www. 1040a form to print defensetravel. 1040a form to print dod. 1040a form to print mil/site/perdiemCalc. 1040a form to print cfm. 1040a form to print You can access all other foreign per diem rates at: www. 1040a form to print state. 1040a form to print gov/travel/. 1040a form to print Click on “Travel Per Diem Allowances for Foreign Areas,” under “Foreign Per Diem Rates” to obtain the latest foreign per diem rates. 1040a form to print Special rate for transportation workers. 1040a form to print   You can use a special standard meal allowance if you work in the transportation industry. 1040a form to print You are in the transportation industry if your work: Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates. 1040a form to print If this applies to you, you can claim a standard meal allowance of $59 a day ($65 for travel outside the continental United States). 1040a form to print   Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area where you stop for sleep or rest. 1040a form to print If you choose to use the special rate for any trip, you must use the special rate (and not use the regular standard meal allowance rates) for all trips you take that year. 1040a form to print Travel for days you depart and return. 1040a form to print   For both the day you depart for and the day you return from a business trip, you must prorate the standard meal allowance (figure a reduced amount for each day). 1040a form to print You can do so by one of two methods. 1040a form to print Method 1: You can claim 3/4 of the standard meal allowance. 1040a form to print Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice. 1040a form to print Example. 1040a form to print Jen is employed in New Orleans as a convention planner. 1040a form to print In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. 1040a form to print She left her home in New Orleans at 10 a. 1040a form to print m. 1040a form to print on Wednesday and arrived in Washington, DC, at 5:30 p. 1040a form to print m. 1040a form to print After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p. 1040a form to print m. 1040a form to print Jen's employer gave her a flat amount to cover her expenses and included it with her wages. 1040a form to print Under Method 1, Jen can claim 2½ days of the standard meal allowance for Washington, DC: 3/4 of the daily rate for Wednesday and Friday (the days she departed and returned), and the full daily rate for Thursday. 1040a form to print Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. 1040a form to print For example, she could claim 3 days of the standard meal allowance even though a federal employee would have to use Method 1 and be limited to only 2½ days. 1040a form to print Travel in the United States The following discussion applies to travel in the United States. 1040a form to print For this purpose, the United States includes the 50 states and the District of Columbia. 1040a form to print The treatment of your travel expenses depends on how much of your trip was business related and on how much of your trip occurred within the United States. 1040a form to print See Part of Trip Outside the United States , later. 1040a form to print Trip Primarily for Business You can deduct all of your travel expenses if your trip was entirely business related. 1040a form to print If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct only your business-related travel expenses. 1040a form to print These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination. 1040a form to print Example. 1040a form to print You work in Atlanta and take a business trip to New Orleans in May. 1040a form to print Your business travel totals 850 miles round trip. 1040a form to print On your way, you stop in Mobile to visit your parents. 1040a form to print You spend $2,120 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. 1040a form to print If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,820. 1040a form to print You can deduct $1,820 for your trip, including the cost of round-trip transportation to and from New Orleans. 1040a form to print The deduction for your meals is subject to the 50% limit on meals mentioned earlier. 1040a form to print Trip Primarily for Personal Reasons If your trip was primarily for personal reasons, such as a vacation, the entire cost of the trip is a nondeductible personal expense. 1040a form to print However, you can deduct any expenses you have while at your destination that are directly related to your business. 1040a form to print A trip to a resort or on a cruise ship may be a vacation even if the promoter advertises that it is primarily for business. 1040a form to print The scheduling of incidental business activities during a trip, such as viewing videotapes or attending lectures dealing with general subjects, will not change what is really a vacation into a business trip. 1040a form to print Part of Trip Outside the United States If part of your trip is outside the United States, use the rules described later in this chapter under Travel Outside the United States for that part of the trip. 1040a form to print For the part of your trip that is inside the United States, use the rules for travel in the United States. 1040a form to print Travel outside the United States does not include travel from one point in the United States to another point in the United States. 1040a form to print The following discussion can help you determine whether your trip was entirely within the United States. 1040a form to print Public transportation. 1040a form to print   If you travel by public transportation, any place in the United States where that vehicle makes a scheduled stop is a point in the United States. 1040a form to print Once the vehicle leaves the last scheduled stop in the United States on its way to a point outside the United States, you apply the rules under Travel Outside the United States . 1040a form to print Example. 1040a form to print You fly from New York to Puerto Rico with a scheduled stop in Miami. 1040a form to print You return to New York nonstop. 1040a form to print The flight from New York to Miami is in the United States, so only the flight from Miami to Puerto Rico is outside the United States. 1040a form to print Because there are no scheduled stops between Puerto Rico and New York, all of the return trip is outside the United States. 1040a form to print Private car. 1040a form to print   Travel by private car in the United States is travel between points in the United States, even though you are on your way to a destination outside the United States. 1040a form to print Example. 1040a form to print You travel by car from Denver to Mexico City and return. 1040a form to print Your travel from Denver to the border and from the border back to Denver is travel in the United States, and the rules in this section apply. 1040a form to print The rules under Travel Outside the United States apply to your trip from the border to Mexico City and back to the border. 1040a form to print Travel Outside the United States If any part of your business travel is outside the United States, some of your deductions for the cost of getting to and from your destination may be limited. 1040a form to print For this purpose, the United States includes the 50 states and the District of Columbia. 1040a form to print How much of your travel expenses you can deduct depends in part upon how much of your trip outside the United States was business related. 1040a form to print Travel Entirely for Business or Considered Entirely for Business You can deduct all your travel expenses of getting to and from your business destination if your trip is entirely for business or considered entirely for business. 1040a form to print Travel entirely for business. 1040a form to print   If you travel outside the United States and you spend the entire time on business activities, you can deduct all of your travel expenses. 1040a form to print Travel considered entirely for business. 1040a form to print   Even if you did not spend your entire time on business activities, your trip is considered entirely for business if you meet at least one of the following four exceptions. 1040a form to print Exception 1 - No substantial control. 1040a form to print   Your trip is considered entirely for business if you did not have substantial control over arranging the trip. 1040a form to print The fact that you control the timing of your trip does not, by itself, mean that you have substantial control over arranging your trip. 1040a form to print   You do not have substantial control over your trip if you: Are an employee who was reimbursed or paid a travel expense allowance, and Are not related to your employer, or Are not a managing executive. 1040a form to print    “Related to your employer” is defined later in chapter 6 under Per Diem and Car Allowances . 1040a form to print   A “managing executive” is an employee who has the authority and responsibility, without being subject to the veto of another, to decide on the need for the business travel. 1040a form to print   A self-employed person generally has substantial control over arranging business trips. 1040a form to print Exception 2 - Outside United States no more than a week. 1040a form to print   Your trip is considered entirely for business if you were outside the United States for a week or less, combining business and nonbusiness activities. 1040a form to print One week means 7 consecutive days. 1040a form to print In counting the days, do not count the day you leave the United States, but do count the day you return to the United States. 1040a form to print Example. 1040a form to print You traveled to Brussels primarily for business. 1040a form to print You left Denver on Tuesday and flew to New York. 1040a form to print On Wednesday, you flew from New York to Brussels, arriving the next morning. 1040a form to print On Thursday and Friday, you had business discussions, and from Saturday until Tuesday, you were sightseeing. 1040a form to print You flew back to New York, arriving Wednesday afternoon. 1040a form to print On Thursday, you flew back to Denver. 1040a form to print Although you were away from your home in Denver for more than a week, you were not outside the United States for more than a week. 1040a form to print This is because the day you depart does not count as a day outside the United States. 1040a form to print You can deduct your cost of the round-trip flight between Denver and Brussels. 1040a form to print You can also deduct the cost of your stay in Brussels for Thursday and Friday while you conducted business. 1040a form to print However, you cannot deduct the cost of your stay in Brussels from Saturday through Tuesday because those days were spent on nonbusiness activities. 1040a form to print Exception 3 - Less than 25% of time on personal activities. 1040a form to print   Your trip is considered entirely for business if: You were outside the United States for more than a week, and You spent less than 25% of the total time you were outside the United States on nonbusiness activities. 1040a form to print For this purpose, count both the day your trip began and the day it ended. 1040a form to print Example. 1040a form to print You flew from Seattle to Tokyo, where you spent 14 days on business and 5 days on personal matters. 1040a form to print You then flew back to Seattle. 1040a form to print You spent 1 day flying in each direction. 1040a form to print Because only 5/21 (less than 25%) of your total time abroad was for nonbusiness activities, you can deduct as travel expenses what it would have cost you to make the trip if you had not engaged in any nonbusiness activity. 1040a form to print The amount you can deduct is the cost of the round-trip plane fare and 16 days of meals (subject to the 50% limit), lodging, and other related expenses. 1040a form to print Exception 4 - Vacation not a major consideration. 1040a form to print   Your trip is considered entirely for business if you can establish that a personal vacation was not a major consideration, even if you have substantial control over arranging the trip. 1040a form to print Travel Primarily for Business If you travel outside the United States primarily for business but spend some of your time on other activities, you generally cannot deduct all of your travel expenses. 1040a form to print You can only deduct the business portion of your cost of getting to and from your destination. 1040a form to print You must allocate the costs between your business and other activities to determine your deductible amount. 1040a form to print See Travel allocation rules , later. 1040a form to print You do not have to allocate your travel expenses if you meet one of the four exceptions listed earlier under Travel considered entirely for business . 1040a form to print In those cases, you can deduct the total cost of getting to and from your destination. 1040a form to print Travel allocation rules. 1040a form to print   If your trip outside the United States was primarily for business, you must allocate your travel time on a day-to-day basis between business days and nonbusiness days. 1040a form to print The days you depart from and return to the United States are both counted as days outside the United States. 1040a form to print   To figure the deductible amount of your round-trip travel expenses, use the following fraction. 1040a form to print The numerator (top number) is the total number of business days outside the United States. 1040a form to print The denominator (bottom number) is the total number of business and nonbusiness days of travel. 1040a form to print Counting business days. 1040a form to print   Your business days include transportation days, days your presence was required, days you spent on business, and certain weekends and holidays. 1040a form to print Transportation day. 1040a form to print   Count as a business day any day you spend traveling to or from a business destination. 1040a form to print However, if because of a nonbusiness activity you do not travel by a direct route, your business days are the days it would take you to travel a reasonably direct route to your business destination. 1040a form to print Extra days for side trips or nonbusiness activities cannot be counted as business days. 1040a form to print Presence required. 1040a form to print   Count as a business day any day your presence is required at a particular place for a specific business purpose. 1040a form to print Count it as a business day even if you spend most of the day on nonbusiness activities. 1040a form to print Day spent on business. 1040a form to print   If your principal activity during working hours is the pursuit of your trade or business, count the day as a business day. 1040a form to print Also, count as a business day any day you are prevented from working because of circumstances beyond your control. 1040a form to print Certain weekends and holidays. 1040a form to print   Count weekends, holidays, and other necessary standby days as business days if they fall between business days. 1040a form to print But if they follow your business meetings or activity and you remain at your business destination for nonbusiness or personal reasons, do not count them as business days. 1040a form to print Example 1. 1040a form to print Your tax home is New York City. 1040a form to print You travel to Quebec, where you have a business appointment on Friday. 1040a form to print You have another appointment on the following Monday. 1040a form to print Because your presence was required on both Friday and Monday, they are business days. 1040a form to print Because the weekend is between business days, Saturday and Sunday are counted as business days. 1040a form to print This is true even though you use the weekend for sightseeing, visiting friends, or other nonbusiness activity. 1040a form to print Example 2. 1040a form to print If, in Example 1, you had no business in Quebec after Friday, but stayed until Monday before starting home, Saturday and Sunday would be nonbusiness days. 1040a form to print Nonbusiness activity on the way to or from your business destination. 1040a form to print   If you stopped for a vacation or other nonbusiness activity either on the way from the United States to your business destination, or on the way back to the United States from your business destination, you must allocate part of your travel expenses to the nonbusiness activity. 1040a form to print   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your nonbusiness destination and a return to the point where travel outside the United States ends. 1040a form to print   You determine the nonbusiness portion of that expense by multiplying it by a fraction. 1040a form to print The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. 1040a form to print Example. 1040a form to print You live in New York. 1040a form to print On May 4 you flew to Paris to attend a business conference that began on May 5. 1040a form to print The conference ended at noon on May 14. 1040a form to print That evening you flew to Dublin where you visited with friends until the afternoon of May 21, when you flew directly home to New York. 1040a form to print The primary purpose for the trip was to attend the conference. 1040a form to print If you had not stopped in Dublin, you would have arrived home the evening of May 14. 1040a form to print You do not meet any of the exceptions that would allow you to consider your travel entirely for business. 1040a form to print May 4 through May 14 (11 days) are business days and May 15 through May 21 (7 days) are nonbusiness days. 1040a form to print You can deduct the cost of your meals (subject to the 50% limit), lodging, and other business-related travel expenses while in Paris. 1040a form to print You cannot deduct your expenses while in Dublin. 1040a form to print You also cannot deduct 7/18 of what it would have cost you to travel round-trip between New York and Dublin. 1040a form to print You paid $750 to fly from New York to Paris, $400 to fly from Paris to Dublin, and $700 to fly from Dublin back to New York. 1040a form to print Round-trip airfare from New York to Dublin would have been $1,250. 1040a form to print You figure the deductible part of your air travel expenses by subtracting 7/18 of the round-trip fare and other expenses you would have had in traveling directly between New York and Dublin ($1,250 × 7/18 = $486) from your total expenses in traveling from New York to Paris to Dublin and back to New York ($750 + $400 + $700 = $1,850). 1040a form to print Your deductible air travel expense is $1,364 ($1,850 − $486). 1040a form to print Nonbusiness activity at, near, or beyond business destination. 1040a form to print   If you had a vacation or other nonbusiness activity at, near, or beyond your business destination, you must allocate part of your travel expenses to the nonbusiness activity. 1040a form to print   The part you must allocate is the amount it would have cost you to travel between the point where travel outside the United States begins and your business destination and a return to the point where travel outside the United States ends. 1040a form to print   You determine the nonbusiness portion of that expense by multiplying it by a fraction. 1040a form to print The numerator (top number) of the fraction is the number of nonbusiness days during your travel outside the United States and the denominator (bottom number) is the total number of days you spend outside the United States. 1040a form to print   None of your travel expenses for nonbusiness activities at, near, or beyond your business destination are deductible. 1040a form to print Example. 1040a form to print Assume that the dates are the same as in the previous example but that instead of going to Dublin for your vacation, you fly to Venice, Italy, for a vacation. 1040a form to print You cannot deduct any part of the cost of your trip from Paris to Venice and return to Paris. 1040a form to print In addition, you cannot deduct 7/18 of the airfare and other expenses from New York to Paris and back to New York. 1040a form to print You can deduct 11/18 of the round-trip plane fare and other travel expenses from New York to Paris, plus your meals (subject to the 50% limit), lodging, and any other business expenses you had in Paris. 1040a form to print (Assume these expenses total $4,939. 1040a form to print ) If the round-trip plane fare and other travel-related expenses (such as food during the trip) are $1,750, you can deduct travel costs of $1,069 (11/18 × $1,750), plus the full $4,939 for the expenses you had in Paris. 1040a form to print Other methods. 1040a form to print   You can use another method of counting business days if you establish that it more clearly reflects the time spent on other than business activities outside the United States. 1040a form to print Travel Primarily for Personal Reasons If you travel outside the United States primarily for vacation or for investment purposes, the entire cost of the trip is a nondeductible personal expense. 1040a form to print However, if you spend some time attending brief professional seminars or a continuing education program, you can deduct your registration fees and other expenses you have that are directly related to your business. 1040a form to print Example. 1040a form to print The university from which you graduated has a continuing education program for members of its alumni association. 1040a form to print This program consists of trips to various foreign countries where academic exercises and conferences are set up to acquaint individuals in most occupations with selected facilities in several regions of the world. 1040a form to print However, none of the conferences are directed toward specific occupations or professions. 1040a form to print It is up to each participant to seek out specialists and organizational settings appropriate to his or her occupational interests. 1040a form to print Three-hour sessions are held each day over a 5-day period at each of the selected overseas facilities where participants can meet with individual practitioners. 1040a form to print These sessions are composed of a variety of activities including workshops, mini-lectures, role playing, skill development, and exercises. 1040a form to print Professional conference directors schedule and conduct the sessions. 1040a form to print Participants can choose those sessions they wish to attend. 1040a form to print You can participate in this program since you are a member of the alumni association. 1040a form to print You and your family take one of the trips. 1040a form to print You spend about 2 hours at each of the planned sessions. 1040a form to print The rest of the time you go touring and sightseeing with your family. 1040a form to print The trip lasts less than 1 week. 1040a form to print Your travel expenses for the trip are not deductible since the trip was primarily a vacation. 1040a form to print However, registration fees and any other incidental expenses you have for the five planned sessions you attended that are directly related and beneficial to your business are deductible business expenses. 1040a form to print These expenses should be specifically stated in your records to ensure proper allocation of your deductible business expenses. 1040a form to print Luxury Water Travel If you travel by ocean liner, cruise ship, or other form of luxury water transportation for business purposes, there is a daily limit on the amount you can deduct. 1040a form to print The limit is twice the highest federal per diem rate allowable at the time of your travel. 1040a form to print (Generally, the federal per diem is the amount paid to federal government employees for daily living expenses when they travel away from home, but in the United States, for business purposes. 1040a form to print ) Daily limit on luxury water travel. 1040a form to print   The highest federal per diem rate allowed and the daily limit for luxury water travel in 2013 is shown in the following table. 1040a form to print   2013 Dates Highest Federal Per Diem Daily Limit on Luxury Water Travel   Jan. 1040a form to print 1 – Mar. 1040a form to print 31 $367 $734   Apr. 1040a form to print 1 – June 30 312 624   July 1 – Aug. 1040a form to print 31 310 620   Sept. 1040a form to print 1 – Sept. 1040a form to print 30 366 732   Oct. 1040a form to print 1 – Dec. 1040a form to print 31 374 748 Example. 1040a form to print Caroline, a travel agent, traveled by ocean liner from New York to London, England, on business in May. 1040a form to print Her expense for the 6-day cruise was $5,200. 1040a form to print Caroline's deduction for the cruise cannot exceed $3,744 (6 days × $624 daily limit). 1040a form to print Meals and entertainment. 1040a form to print   If your expenses for luxury water travel include separately stated amounts for meals or entertainment, those amounts are subject to the 50% limit on meals and entertainment before you apply the daily limit. 1040a form to print For a discussion of the 50% Limit , see chapter 2. 1040a form to print Example. 1040a form to print In the previous example, Caroline's luxury water travel had a total cost of $5,200. 1040a form to print Of that amount, $3,700 was separately stated as meals and entertainment. 1040a form to print Caroline, who is self-employed, is not reimbursed for any of her travel expenses. 1040a form to print Caroline figures her deductible travel expenses as follows. 1040a form to print Meals and entertainment $3,700   50% limit × . 1040a form to print 50   Allowable meals &     entertainment $1,850   Other travel expenses + 1,800   Allowable cost before the daily limit $3,650 Daily limit for May 2013 $624   Times number of days × 6   Maximum luxury water travel     deduction $3,744 Amount of allowable deduction $3,650 Caroline's deduction for her cruise is limited to $3,650, even though the limit on luxury water travel is slightly higher. 1040a form to print Not separately stated. 1040a form to print   If your meal or entertainment charges are not separately stated or are not clearly identifiable, you do not have to allocate any portion of the total charge to meals or entertainment. 1040a form to print Exceptions The daily limit on luxury water travel (discussed earlier) does not apply to expenses you have to attend a convention, seminar, or meeting on board a cruise ship. 1040a form to print See Cruise Ships under Conventions. 1040a form to print Conventions You can deduct your travel expenses when you attend a convention if you can show that your attendance benefits your trade or business. 1040a form to print You cannot deduct the travel expenses for your family. 1040a form to print If the convention is for investment, political, social, or other purposes unrelated to your trade or business, you cannot deduct the expenses. 1040a form to print Your appointment or election as a delegate does not, in itself, determine whether you can deduct travel expenses. 1040a form to print You can deduct your travel expenses only if your attendance is connected to your own trade or business. 1040a form to print Convention agenda. 1040a form to print   The convention agenda or program generally shows the purpose of the convention. 1040a form to print You can show your attendance at the convention benefits your trade or business by comparing the agenda with the official duties and responsibilities of your position. 1040a form to print The agenda does not have to deal specifically with your official duties and responsibilities; it will be enough if the agenda is so related to your position that it shows your attendance was for business purposes. 1040a form to print Conventions Held Outside the North American Area You cannot deduct expenses for attending a convention, seminar, or similar meeting held outside the North American area unless: The meeting is directly related to your trade or business, and It is reasonable to hold the meeting outside the North American area. 1040a form to print See Reasonableness test , later. 1040a form to print If the meeting meets these requirements, you also must satisfy the rules for deducting expenses for business trips in general, discussed earlier under Travel Outside the United States . 1040a form to print North American area. 1040a form to print   The North American area includes the following locations. 1040a form to print American Samoa Johnston Island Antigua and Barbuda Kingman Reef Aruba Marshall Islands Bahamas Mexico Baker Island Micronesia Barbados Midway Islands Bermuda Netherlands Antilles Canada Northern Mariana Costa Rica Islands Dominica Palau Dominican Republic Palmyra Atoll Grenada Panama Guam Puerto Rico Guyana Trinidad and Tobago Honduras USA Howland Island U. 1040a form to print S. 1040a form to print Virgin Islands Jamaica Wake Island Jarvis Island   The North American area also includes U. 1040a form to print S. 1040a form to print islands, cays, and reefs that are possessions of the United States and not part of the fifty states or the District of Columbia. 1040a form to print Reasonableness test. 1040a form to print   The following factors are taken into account to determine if it was reasonable to hold the meeting outside the North American area. 1040a form to print The purpose of the meeting and the activities taking place at the meeting. 1040a form to print The purposes and activities of the sponsoring organizations or groups. 1040a form to print The homes of the active members of the sponsoring organizations and the places at which other meetings of the sponsoring organizations or groups have been or will be held. 1040a form to print Other relevant factors you may present. 1040a form to print Cruise Ships You can deduct up to $2,000 per year of your expenses of attending conventions, seminars, or similar meetings held on cruise ships. 1040a form to print All ships that sail are considered cruise ships. 1040a form to print You can deduct these expenses only if all of the following requirements are met. 1040a form to print The convention, seminar, or meeting is directly related to your trade or business. 1040a form to print The cruise ship is a vessel registered in the United States. 1040a form to print All of the cruise ship's ports of call are in the United States or in possessions of the United States. 1040a form to print You attach to your return a written statement signed by you that includes information about: The total days of the trip (not including the days of transportation to and from the cruise ship port), The number of hours each day that you devoted to scheduled business activities, and A program of the scheduled business activities of the meeting. 1040a form to print You attach to your return a written statement signed by an officer of the organization or group sponsoring the meeting that includes: A schedule of the business activities of each day of the meeting, and The number of hours you attended the scheduled business activities. 1040a form to print Prev  Up  Next   Home   More Online Publications