*All the information contained in the article applies to the citizens of the United States of America.
Budgeting for every trip is a must. Everyone does it. However, travel bloggers, who travel for a living, can budget better by accounting for the travel blogger tax deductions to which they might be eligible. It can bring down their tax bill and allow them to get more value out for their money.
Are you a travel blogger on a budget? Then, this is for you!
Run Your Blog Like a Business
You can bring down your taxes significantly and improve your travel budget if you can make a good case for your blog being a business and not a hobby. Remember that the IRS wants to know how your business functions today and not how you plan to transform it in the future. So, stick to the current facts when claiming travel blog business tax deductions.
IRS has specific guidelines in place to distinguish between a business and a hobby. If you can meet these eligibility requirements, it can make your travel budgets very happy.
If you can justify that you needed an expense for your travel blog, you can make travel blog tax deductions. There are two types of expenses that the IRS considers for deductions. These are ordinary and necessary expenses. An ordinary expense is any expense that is commonplace in travel blogging. On the other hand, necessary expense is the one that you made that was required by your business.
Let’s say you are going to Spain for your next blog trip. Your tickets to Spain are a necessary expense. However, you do not have to travel business class for it. That is where you cross the line between a necessary cost and an unnecessary expense.
Aim for the Maximum Benefit
Suppose you are mixing a business trip and a personal trip. Now, you are going to Spain, but you also want to spend some time with your partner in Ibiza. If you are mixing it up, you can claim deductions for a part of the trip.
For instance, let’s say you are carrying cameras to Spain to take some stunning pictures. If you use that camera to take personal photographs, it can lead to complications. You can avoid the confusion and save yourself money by taking two different cameras – one for business and one for pleasure.
So, instead of writing off the whole bill for the vacation, go for a prorated claim. It will help you avoid an audit.
It’s Technical But Doable
Travel blogging is not the doorway to free family vacations. It just isn’t. There are strict guidelines that dictate how expenses should be defined and written off. If you are a serious travel blogger, make sure you have an explanation for the expenses you write off if you ever have to face an audit. And it is always wise to consult a professional if you do not understand your finances that well.