Travel, Entertainment & Auto Rules - 24 CPE
Course Description & Study Guide
Updating practitioners on current developments, this core program examines and explains the practical aspects of travel and entertainment deductions. Fundamentals are reviewed and planning opportunities identified. Creative strategies are discussed and evaluated along with traditional approaches. Taxpayers are once again looking to their tax professional for guidance and planning related to travel and entertainment expenses. The goal of this course is to understand and solve problems. Participants will learn to master the proper administration of these complex and often cumbersome provisions in a humorous and entertaining format.
Completion Deadline & Exam: This course, including the examination, must be completed within one year of the date of purchase. In addition, unless otherwise indicated, no correct or incorrect feedback for any exam question will be provided.
Course Level: Overview. This program is appropriate for professionals at all organizational levels.
Field of Study: Taxes
Prerequisite:General understanding of federal income taxation.
Learning Assignments & Objectives
As a result of studying each assignment, you should be able to meet the objectives listed below each assignment.
Chapter 1 Travel Expenses
At the start of Chapter 1, participants should identify the following topics for study:
* Job hunting travel
* Travel expenses of investors
* Transportation expenses
* Business purpose requirement
* Circuit Court test for “tax home”
* IRS test for “tax home”
* No tax home
* Two work locations
* Away from home requirement
* Temporary & indefinite assignments
After reading Chapter 1, participants will be able to:
1. Recognize transportation from business travel under §162 by identifying at least nine types of business travel expenses and stating the requirements of §165 and §195 to obtain a deduction or amortization.
2. List deductible travel costs to find a new job, identify investor travel expenses, and define deductible transportation.
3. Identify the business purpose requirement pointing out the complications of mixed business and personal travel noting the costs at a destination.
4. State the IRS’s and Circuit Courts’ definition of “tax home” locate related cases, identify when a taxpayer lacks a tax home, and state the “away from home” requirement including the sleep and rest rule.
5. Define temporary and indefinite job assignments recognizing the critical factor in distinguishing the two job assignments.
After studying the materials in Chapter 1, answer the exam questions 1 to 27.
Chapter 2 Categories of Business Travel Expense
At the start of Chapter 2, participants should identify the following topics for study:
* Domestic business travel primarily for business
* Point-to-point rules
* Extended stay or side trip rule
* Foreign business travel
* Conventions & meetings
* Conventions outside the North American area
* Cruise ship conventions
* Luxury water travel
* Spousal & companion travel expenses
* Aides to sick & handicapped individuals
After reading Chapter 2, participants will be able to:
1. Identify the key elements of domestic business travel noting what costs are deductible.
2. State the point-to-point rule for different modes of transportation, and name which expenses incurred on a business trip with an extended stay or side trip are deductible.
3. Identify the rules for foreign business travel by:
a. Recognizing when foreign travel is fully deductible or disallowed, stating the foreign travel allocation rule and defining total allowable foreign travel expenses; and
b. Showing the allocation of expenses incurred in traveling on a foreign side trip; and listing five exceptions to the general rule.
4. Recognize the deduction of convention and meeting expenses based on Reg. §1.162 by:
a. Listing four relevant factors under the agenda test and stating the application of the this test to determine if a meeting is predominantly business related;
b. Identifying the availability of the convention and meeting deduction to professional groups, self-employed persons, and employees noting the videotaped lecture rule; and
c. Listing the differences between foreign conventions and foreign travel and naming four convention expenses permitted under §274(h)
5. Outline the rules and limitations on cruise ship conventions noting the luxury water travel exception, recognize the companion travel expense limitations, and identify whether expenses for aides to handicapped taxpayers accompanying the taxpayers on business trips are deductible travel expenses.
After studying the materials in Chapter 2, answer the exam questions 28 to 44.
Chapter 3 Local Transportation
At the start of Chapter 3, participants should identify the following topics for study:
* Parking fees
* Trips to union hall
* Commuting & economic hardship
* Irregular work site assignments
* Home office
* Hauling tools & equipment
* Transportation between different sites
* Transportation between different jobs
After reading Chapter 3, participants will be able to:
1. Define transportation, local transportation, and commuting, recognize when parking fees are deductible, and state the effect of the Washburn case on commuting deductions.
2. Identify the regular/irregular rule, define a temporary work site under R.R. 90-23, outline the impact of R.R. 94-47 and R.R. 99-7 on transportation between a taxpayer’s residence and workplace, list the §280A home office requirements noting its impact on business transportation, and define the hauling tool rule.
After studying the materials in Chapter 3, answer the exam questions 45 to 50.
Chapter 4 Automobiles
At the start of Chapter 4, participants should identify the following topics for study:
* Apportionment of personal & business use
* Deduction limitations using actual cost method
* Expensing - §179
* Predominate business use rule
* Auto leasing
* Standard mileage method
* Auto trade-in vs. sale
* Employer-provided automobile
* Nonpersonal use vehicle
* Reporting of employer-provided automobile
After reading Chapter 4, participants will be able to:
1. Recognize the apportionment of business and personal use of an automobile by:
a. Naming two generally accepted methods of making an apportionment; and
b. Identifying the automobile costs that are generally deductible and nondeductible and the exceptions to these methods.
2. List fourteen actual cost method expenses, and outline auto depreciation and §179 expensing by:
a. Defining car for purposes of these provisions, identifying basis for figuring depreciation, and determining when a car is placed in service; and
b. Naming various depreciation methods and conventions under the modified cost recovery system (MACRS) and listing the depreciation caps that apply to different vehicles.
3. Recognize the §179 expensing deduction’s relationship to depreciation and identify a beneficial decision to use it.
4. State the impact of the §280F predomi