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Military Employee Business Expenses22-6What is the deduction for meals?U.S. service personnel can deduct the cost of meals and business-related entertainment incurred during business travel away from their permanent duty station. Meals and entertainment expenses are figured separately from other business travel expenses. They are multiplied by a percentage: 50% for most taxpayers and 80% for those subject to Department of Transportation hours of service.Taxpayers may report the actual amounts for meals, entertainment, and incidental expenses or they may use a standard amount to claim meals and incidental expenses. In either case, the service member must provide records to prove the time, place, and business purpose of the travel. For service personnel who are fully reimbursed by the government for meals under an accountable plan that excludes reimbursement from gross income, there is no amount to deduct and, therefore, no amount subject to the 50% limit. For information on using the standard meal allowance instead of actual expenses, see Publication 463, Travel, Entertainment, Gift, and Car Expenses.What are local transportation expenses?Local transportation expenses are typically defined as the ordinary and necessary costs incurred in getting from one place to another to perform work-related duties while nottraveling away from home. This can include traveling from one job to another. However, the expenses of getting to and from the taxpayer’s regu-lar place of work are not deductible.Allowable local transportation expenses include:• The cost of driving and maintaining one’s own vehicle• Travel by rental cars, bus, rail, or taxi Are car expenses deductible?Service personnel who use their own vehicles to travel for work are entitled to deduct actual expenses or the standard mileage rate to figure the deductible costs of operating their vehicles for business purposes. The standard mileage rate can be found on Form 2106, Part II, Section B, and Form 2106-EZ, Part II.Actual expenses include the cost of gas, oil, repairs, insurance, and depreciation on the vehicle. If a taxpayer chooses to use actual expenses instead of the standard mileage rate, refer them to a professional tax preparer.EXERCISES (continued)Question 8:Which of the following costs are considered to be a local transportation expense?A. Daily meals taken during a week-long training session while on dutyB. Gasoline used to drive to and from one’s regular place of workC. Taxi fare to travel while on duty to a local work-related conventionD. Elaborate lunch to treat top-ranking military official visiting base
Military Employee Business Expenses22-7Are expenses related to temporary work locations deductible?