Question

If a taxpayer takes a trip within the United States which is primarily for business, the cost of travel to and from the destination need not be prorated between the business and personal portion of the trip.True / False.

Answer 1

Answer:

The statement is true

Explanation:

Business expenses are deductible to the extent that they are incurred outside the tax home. Expenses related to business purpose are deductible. For example, meals and lodging expenses. Personal expenses are not deductible.

However, for cost incurred on travel to and from destination within tax home is considered business expenses and is not required to be prorated between business and personal expenses. IRS keeps a close eye on any business travel outside tax home as in this case expenses need to be prorated between business and personal use.