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Tax & accounting

Business Travel, Meals and Car Mileage Deductions (IRS Pub 463)

Pub 463 covers travel away from home, non-entertainment meals, business gifts and car expenses for employees and sole proprietors. The assistant can tell you what qualifies and which records to keep.

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Answers are written by a language model solely from this base's documents, with numbered sources. They can be wrong and aren't legal, medical or financial advice: check the sources before any important decision.

Travel away from your tax home

Your tax home is generally your regular place of business or post of duty, regardless of where your family home is, and it includes the entire city or general area. If you have more than one regular place of business, your tax home is your main one.

You are traveling away from home if your duties require you to be away from the general area of your tax home substantially longer than an ordinary day's work, and you need to sleep or rest to meet the demands of your work.

Meals, entertainment and gifts

Entertainment, amusement and recreation expenses can no longer be deducted. Business meals that are not entertainment remain deductible, subject to a 50% limit; if you are not reimbursed, the limit applies even when the meal is part of business travel.

For business gifts, you can deduct no more than $25 for gifts given directly or indirectly to each person during your tax year.

Car expenses and commuting

For 2025, the standard mileage rate for business use of a car is 70 cents per mile. You can deduct actual expenses or the standard mileage rate, plus business-related tolls and parking. To use the standard mileage rate for a car you own, you must choose it in the first year the car is available for business use.

Trips between your home and your main or regular place of work are personal commuting expenses and are not deductible.

Frequently asked questions

Can I switch from the standard mileage rate to actual expenses later?

Yes, but Pub 463 states that if you used the standard mileage rate in the first year and change to actual expenses later, you cannot depreciate the car under the MACRS rules.

Are client dinners fully deductible?

Non-entertainment business meals are generally subject to the 50% limit. Expenses for activities considered entertainment, amusement or recreation are not deductible.

How should I record my travel and car expenses?

Pub 463 says you can use a log, diary, notebook or any other written record to keep track of your expenses. The assistant can explain what each record should show.

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