Business Travel

Summer is here and for many of us that indicates summer organization trips. I love traveling for company. It usually means I’m on my way to speak at a seminar in a great location. But, my least favorite part about organization trips is keeping track of all of my receipts.

I use to come property from a company trip and find my receipts in different locations over the next a number of days (or weeks!). Some I would locate in my wallet, other people in my briefcase, far more in my coat pocket, some in my auto and with all of these, I was still missing receipts!

That was until I came up with my system for easy company travel recordkeeping. This system is so easy to use and it maximizes my organization travel deductions.

Here’s how my system for straightforward enterprise travel recordkeeping works:

*Rule #1*

Use the Convenience and Leverage of Email

When my airfare is booked, the airline sends me an email automatically that has all the info I need for my receipt. I forward that email to my bookkeeper immediately upon receipt. That takes care of the airfare receipt.

When I check out from my hotel, I request to have a copy of my bill emailed to me. I forward that email to my bookkeeper immediately upon receipt. That takes care of my hotel receipt.

With my airfare and hotel receipt, I have the receipts for the majority of my actual expenses. But most of the receipts from my travel come from the other expenses, like meals, cab fare, money tips. Here is how I tackle those receipts.

*Rule #2*

Pack 2 Envelopes

Part of my packing for a company trip consists of packing 2 envelopes in my carry on bag. The 1st envelope I label with my destination, travel dates and “Meals.” The other envelope I label with my destination, travel dates and “Other.” Any time I get a receipt from a meal, it goes in the “Meal” envelope. Any time I get any other receipt, I put it in the “Other” envelope. After my trip, I give the envelopes to my bookkeeper to record my travel expenses.

It’s such a basic system, but it works!

You may possibly be wondering why I separate my meal receipts. There are 2 factors I do this.

First, with my meal expenses separated, it makes it simpler for my bookkeeper to code the expenses effectively. My meal expenses are only 50% deductible, but the rest of my business travel is 100% deductible. Separating the two helps make sure that the expenses get coded to separate accounts so only my meals are subject to the 50% limit.

The second reason is so I can maximize my deductions. This is explained in Rule #3.

*Rule #three*

Use Per Diem

To maximize my enterprise travel deductions, I separate my meal receipts AND I use a personal credit card or my personal money to pay for all of meals while traveling. I do this because it is the easiest way to make certain I maximize my organization travel deductions.

Here’s how I maximize my deduction:

When traveling on company, meal receipts are not needed in order to deduct a meal expense. The IRS problems per diem rates for meals and these rates can be used for a meal deduction instead of the actual expense.

This means I can use either my actual meal expenses or I can use the per diem rates. Of course, I often pick the one that gives me the greatest deduction!

I have trained my bookkeeper to compare the total of my actual meal receipts to the per diem allowed. My bookkeeper then determines which provides the greater deduction and records that in my bookkeeping.

For example, if my meal receipts total to 5 and the per diem totals to , then I can legitimately deduct for meals. This is 1 of my favorite strategies due to the fact I have increased my enterprise deductions with out spending any extra cash!

Here’s how I simplify the recordkeeping:

I mentioned that I use a personal credit card or personal money for my meal expenses while traveling. I do this to make certain my company claims the larger of my actual expenses or the per diem allowed.

Once the greater of my actual meal expenses and per diem has been determined, my bookkeeper then completes an expense report that claims the greater quantity. My organization then reimburses me based on the expense report.

Worst case is I get reimbursed the exact amount I spent, but usually times, I’m able to get reimbursed much more than what I truly spent due to the fact the per diem rates are greater. This indicates my organization gets a bigger deduction and my whole reimbursement (even if I am reimbursed far more than what I really spent) is tax free to me!

This is my favorite kind of system – it’s straightforward and it maximizes my deductions!