While the Internal Revenue Service (IRS) has worked to release resources and tips throughout tax season, the latest bit of advice is geared towards business travel.
Taxpayers who travel for their jobs are entitled to write off their trips on their taxes, but it’s important to know what is and isn’t eligible for tax deductions this year.
What can taxpayers write off?
The IRS has outlined a number of requirements for which parts of business trips are able to be deducted on taxes. These include:
Using a personal car for business
Business calls and communication
Travel by plane, train, bus, or car between your home and business destination
Dry cleaning and laundry
Tips for services related to any expenses
Fares for taxi or transportation to or from an airport, train station, hotel, or work location
Lodging and meals
Convention-related expenses (if attendance benefits the business)
Shipping of baggage or display materials between regular or temporary work locations
Any other related necessary and ordinary expenses related to business travel
Perhaps the biggest thing for taxpayers to keep in mind is that any personal or extravagant purchases aren’t eligible for tax deductions. Anything claimed on taxes must be necessary to the business trip.
Taxpayers must also keep in mind that expenses are eligible to be written off for trips that are under one year in length. Additionally, military personnel, self-employed workers, and farmers are all eligible to deduct expenses from business trips.
Digital assets must be reported on taxes
When filing 2022 taxes, taxpayers will again be responsible for reporting all digital assets, or virtual currencies. This includes: non-fungible tokens (NFTs), cryptocurrency and convertible virtual currency, and stablecoins.
While this will appear as a yes or no question on the 2022 return, it’s important to note that taxpayers who haven’t completed any transactions related to their digital assets can answer “no.” Simply owning any kind of virtual currency doesn’t count as digital income.
However, taxpayers who have sold, exchanged, or gifted a digital asset, or those who received a digital asset (either as payment for a service or property, or as a reward or an award), must claim it on their 2022 taxes.
More information is available here.