Yes, your expenses should be allocated between business and personal expenses. If done properly, the IRS allows business owners to write off some aspects of their vacation expenses, even if the trip isn’t used solely for business purposes. Here are the IRS rules that allow you to combine business and pleasure and a guide to identifying travel deductions.
As long as your trip is primarily used for business purposes, and you are traveling away from your place of business for longer than an ordinary day’s work, you can deduct 100 percent of your transportation costs, such as airfare or mileage. On days considered business days, you will also be able to deduct lodging, taxis, car rentals, and 50 percent of your food costs. You can also deduct laundry, dry cleaning, personal grooming, and other “ordinary and reasonable” business expenses necessary for the trip. If you make a layover in another city for personal reasons, you cannot deduct those related travel expenses. The IRS doesn’t require that you keep receipts for expenses less than $75, but you do need to keep a log of the time and date of the expenses. You can do this with help from apps like Expensify or Concur Mobile.
You will only be allowed to deduct the expenses you would typically incur on such a solo business trip, and not those of your family. For instance, if you travel by air, only your ticket will be paid for, but if you drive, the entire expense of it would be deductible because you would have incurred the same expenses on your own. Likewise, only 50 percent of your food costs are deductible, along with your portion of the lodging. That means if you typically rent a single hotel room, but need a double and another room for the kids, you can only deduct the cost of a single room.
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