Foreign Travel: When It’s Deductible

It’s not easy to turn a foreign trip into a tax deduction. Just ask one taxpayer who tried to justify his travel costs as “research” for his writing activities. He was born in France but became a U.S. citizen in 1953. Sometime thereafter, he became a history professor who eventually retired at half-time so he could pursue his writing. With his free time, he frequently traveled to France. On his Schedules C for 2007 and 2008, he reported losses resulting in part from his trips of $59,564 and $37,419, respectively. He never realized any income from his writing.

The Tax Court disallowed deductions for his travel expenses because they were not for business. His research and writing was not an activity engaged in for profit. Moral of the story: Travel expenses—here or abroad—are deductible only if they are for business and not for pleasure.

Source: Westrich; T.C. Summ. Op. 2013-35