Conventions and Seminars – How to Deduct

So you are heading to Las Vegas or Hawaii to attend a seminar or convention for your business. Of course, you also want to have some fun while you are there (all work and no play makes one a dull person!). Here are some tips to keep in mind so that you can claim a valid tax deduction while still enjoying the perks associated with this type of business travel (shows, sightseeing, gambling, recreation, beaches, fishing, etc.):

- Save as much information from the seminar or convention as you possibly can. For instance, make sure you keep a copy of the itinerary, program handouts, registration forms, course materials, business cards and any other information specific to the seminar or convention. This will assist if the IRS questions how or why this event was related to your business (i.e. why this was a “business” expense and not “personal”).

- Keep copies of all receipts, including those for your hotel (required no matter what the cost), meals, entertainment and the fees associated directly with the seminar (for registration, specific programs, books/tapes purchased, etc.). It is critical that you keep these, along with proof of payment (cash, check, credit card) so that you can prove that you really incurred the expenses. While receipts are not required for some travel expenses under $75, I still recommend that you obtain them if at all possible, as it makes these issues in an audit much easier to resolve.

- Make sure that you can prove how the seminar/convention helped your business. For instance, nearly any seminar on taxes, marketing, client satisfaction and the like can be deducted. Do not try to claim a business tax deduction for lifestyle or investment seminars unless that is also your specific business.

- Ensure that the seminar or convention is held in the “North American” area– this includes all of the U.S., the Caribbean, Mexico, Canada and Central America. It is much more difficult to claim valid tax deductions if the seminar is held outside of this geographic area.

- Make sure that you spend more than half of the day on “business” at the seminar or convention. This means that you should, at a minimum, spend at least 4 hours and 1 minute per day attending the event. Do not go to a seminar and then not participate and expect to be able to claim a valid business deduction. You will still have much time for socializing or sightseeing but you must work a bit in order to claim the favorable tax deductions.