jtr business travel

FAC Number: 2024-03 Effective Date: 02/23/2024

31.205-46 Travel costs.

(a) Costs for transportation, lodging, meals, and incidental expenses.

(1) Costs incurred by contractor personnel on official company business are allowable, subject to the limitations contained in this subsection. Costs for transportation may be based on mileage rates, actual costs incurred, or on a combination thereof, provided the method used results in a reasonable charge. Costs for lodging, meals, and incidental expenses may be based on per diem, actual expenses, or a combination thereof, provided the method used results in a reasonable charge.

(2) Except as provided in paragraph (a)(3) of this subsection, costs incurred for lodging, meals, and incidental expenses (as defined in the regulations cited in (a)(2)(i) through (iii) of this section) shall be considered to be reasonable and allowable only to the extent that they do not exceed on a daily basis the maximum per diem rates in effect at the time of travel as set forth in the-

(i) Federal Travel Regulations, prescribed by the General Services Administration, for travel in the contiguous United States , available on a subscription basis from the-

Superintendent of Documents

U.S. Government Publishing Office

Washington DC 20402

Stock No.922-002-00000-2;

(ii) Joint Travel Regulation, Volume2, DoD Civilian Personnel, AppendixA, prescribed by the Department of Defense, for travel in Alaska, Hawaii, and outlying areas of the United States , available on a subscription basis from the-

Stock No.908-010-00000-1; or

(iii) Standardized Regulations (Government Civilians, Foreign Areas), Section 925, "Maximum Travel Per Diem Allowances for Foreign Areas," prescribed by the Department of State, for travel in areas not covered in (a)(2)(i) and (ii) of this paragraph, available on a subscription basis from the-

Washington, DC 20402

Stock No.744-008-00000-0.

(3) In special or unusual situations, actual costs in excess of the above-referenced maximum per diem rates are allowable provided that such amounts do not exceed the higher amounts authorized for Federal civilian employees as permitted in the regulations referenced in (a)(2)(i), (ii), or (iii) of this section. For such higher amounts to be allowable, all of the following conditions must be met:

(i) One of the conditions warranting approval of the actual expense method, as set forth in the regulations referenced in paragraphs (a)(2)(i), (ii), or (iii) of this section, must exist.

(ii) A written justification for use of the higher amounts must be approved by an officer of the contractor’s organization or designee to ensure that the authority is properly administered and controlled to prevent abuse.

(iii) If it becomes necessary to exercise the authority to use the higher actual expense method repetitively or on a continuing basis in a particular area, the contractor must obtain advance approval from the contracting officer .

(iv) Documentation to support actual costs incurred shall be in accordance with the contractor’s established practices, subject to paragraph (a)(7) of this section, and provided that a receipt is required for each expenditure of $75.00 or more. The approved justification required by paragraph (a)(3)(ii) of this section and, if applicable, paragraph (a)(3)(iii) of this section must be retained.

(4) Paragraphs (a)(2) and (3) of this section do not incorporate the regulations cited in paragraphs (a)(2)(i), (ii), and (iii) of this section in their entirety. Only the maximum per diem rates, the definitions of lodging, meals, and incidental expenses, and the regulatory coverage dealing with special or unusual situations are incorporated herein.

(5) An advance agreement (see 31.109 ) with respect to compliance with paragraphs (a)(2) and (3) of this subsection may be useful and desirable.

(6) The maximum per diem rates referenced in paragraph (a)(2) of this subsection generally would not constitute a reasonable daily charge-

(i) When no lodging costs are incurred; and/or

(ii) On partial travel days ( e.g., day of departure and return).

Appropriate downward adjustments from the maximum per diem rates would normally be required under these circumstances. While these adjustments need not be calculated in accordance with the Federal Travel Regulation or Joint Travel Regulations, they must result in a reasonable charge.

(7) Costs shall be allowable only if the following information is documented-

(i) Date and place (city, town, or other similar designation) of the expenses;

(ii) Purpose of the trip; and

(iii) Name of person on trip and that person’s title or relationship to the contractor.

(b) Airfare costs in excess of the lowest priced airfare available to the contractor during normal business hours are unallowable except when such accommodations require circuitous routing, require travel during unreasonable hours, excessively prolong travel, result in increased cost that would offset transportation savings, are not reasonably adequate for the physical or medical needs of the traveler, or are not reasonably available to meet mission requirements. However, in order for airfare costs in excess of the above airfare to be allowable, the applicable condition(s) set forth above must be documented and justified.

(1) "Cost of travel by contractor-owned, -leased, or -chartered aircraft," as used in this paragraph, includes the cost of lease, charter, operation (including personnel), maintenance, depreciation , insurance , and other related costs .

(2) The costs of travel by contractor-owned, -leased, or -chartered aircraft are limited to the allowable airfare described in paragraph (b) of this section for the flight destination unless travel by such aircraft is specifically required by contract specification, term, or condition, or a higher amount is approved by the contracting officer . A higher amount may be agreed to when one or more of the circumstances for justifying higher than allowable airfare listed in paragraph (b) of this section are applicable, or when an advance agreement under paragraph (c)(3) of this section has been executed. In all cases, travel by contractor-owned, -leased, or -chartered aircraft must be fully documented and justified. For each contractor-owned, -leased, or -chartered aircraft used for any business purpose which is charged or allocated, directly or indirectly, to a Government contract, the contractor must maintain and make available manifest/logs for all flights on such company aircraft. As a minimum, the manifest/log shall indicate-

(i) Date, time, and points of departure;

(ii) Destination, date, and time of arrival;

(iii) Name of each passenger and relationship to the contractor;

(iv) Authorization for trip; and

(v) Purpose of trip.

(3) Where an advance agreement is proposed (see 31.109 ), consideration may be given to the following:

(i) Whether scheduled commercial airlines or other suitable, less costly, travel facilities are available at reasonable times, with reasonable frequency, and serve the required destinations conveniently.

(ii) Whether increased flexibility in scheduling results in time savings and more effective use of personnel that would outweigh additional travel costs .

(d) Costs of contractor-owned or -leased automobiles, as used in this paragraph, include the costs of lease, operation (including personnel), maintenance, depreciation , insurance , etc. These costs are allowable, if reasonable, to the extent that the automobiles are used for company business. That portion of the cost of company -furnished automobiles that relates to personal use by employees (including transportation to and from work) is compensation for personal services and is unallowable as stated in 31.205-6 (m)(2).

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Understanding business travel deductions

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IRS Tax Tip 2023-15, February 7, 2023

Whether someone travels for work once a year or once a month, figuring out travel expense tax write-offs might seem confusing. The IRS has information to help all business travelers properly claim these valuable deductions.

Here are some tax details all business travelers should know

Business travel deductions are available when employees must travel away from their  tax home  or  main place of work  for business reasons. A taxpayer is traveling away from home if they are away for longer than an ordinary day's work and they need to sleep to meet the demands of their work while away.

Travel expenses  must be ordinary and necessary. They can't be lavish, extravagant or for personal purposes.

Employers can deduct travel expenses paid or incurred during a  temporary work assignment  if the assignment length does not exceed one year.

Travel expenses for  conventions  are deductible if attendance benefits the business. There are special rules for conventions held  outside North America .

Deductible travel expenses include:

• Travel by airplane, train, bus or car between your home and your business destination.
• Fares for taxis or other types of transportation between an airport or train station and a hotel, or from a hotel to a work location.
• Shipping of baggage and sample or display material between regular and temporary work locations.
• Using a personally owned car for business.
• Lodging and  meals .
• Dry cleaning and laundry.
• Business calls and communication.
• Tips paid for services related to any of these expenses.
• Other similar ordinary and necessary expenses related to the business travel.

Self-employed individuals or farmers with travel deductions

• Those who are self-employed can deduct travel expenses on  Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship) .
• Farmers can use  Schedule F (Form 1040), Profit or Loss From Farming .

Travel deductions for the National Guard or military reserves

National Guard or military reserve servicemembers can claim a deduction for unreimbursed travel expenses paid during the  performance of their duty .

Recordkeeping

Well-organized records  make it easier to prepare a tax return. Keep records such as receipts, canceled checks and other documents that support a deduction.

Subscribe to IRS Tax Tips

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More From Forbes

The rising dark side of business travel ceos need to pay attention to.

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It's time for companies to rethink their approach to business travel.

The business landscape has rapidly changed since the pandemic, with remote work and hybrid models becoming more prominent. Despite these workforce shifts, one aspect remains constant: business travel.

Business travel is back in full force following an expected dip during the pandemic. Corporate travel budgets are returning to pre-pandemic levels, and more companies are planning budget expansions. A Morgan Stanley survey revealed that over two-thirds of companies with under $1 billion in annual revenue anticipated increased travel budgets in the coming year.

The Impact of Frequently Flying

Frequent travel can significantly impact an individual's physical, emotional, and mental well-being . While companies prioritize conventional risk management areas, they often overlook the personal well-being of their travelers. From maintaining a healthy diet to proper sleep and various emotional components such as loneliness and separation, business travelers encounter numerous potential long-term health disruptions that non-traveling employees don't face.

Business travelers had higher claims than non-travelers for all health conditions across the board, along with a higher likelihood of stress-related disorders, as reported in the Harvard Business Review . Lastly, as shared in the Journal of Occupational and Environmental Medicine , frequent business travel adversely affects overall body composition, leading to risks of obesity and various other ailments if left unmanaged, such as heart disease and diabetes.

More and more companies are prioritizing workplace wellness due to factors such as obesity's $400 billion impact on companies . Corporate travel wellness programs are a necessary part of the equation as well. As you look to implement a modern and more robust travel wellness program, start with these two areas:

WhatsApp Brand New iPhone Feature Just Launched That s Much Easier To Use

Apple’s iphone ai plans confirmed with new software upgrade, packers complete safety overhaul with georgia’s javon bullard, embrace bleisure travel.

When attracting and retaining the best people, more and more employees choose lifestyle over salary . It's not out of laziness. It's out of a desire for work-life integration. With this in mind, organizations can embrace employees' desires through bleisure . Organizations can promote work-life integration and rejuvenation by allowing employees to combine business trips with leisure activities.

Implementing flexible travel policies that enable team members to extend their trips on the back end is a way to improve employee satisfaction, productivity, and retention rates. Research shows that 89% of business travelers wanted to add a private holiday to their business trips. Traveling for work is energetically demanding, physically and mentally. A few extra days for leisure allow team members to process their trip, recharge, and return at total capacity.

Treat Your Employees Like Athletes

Just as professional athletes require careful management of their physical, emotional, and mental well-being , so do business travelers. Business travel is a stressor with a high burnout rate and decreased performance across the board. As you revamp your corporate wellness travel program, consider your approach to business travel as a sports team thinks of traveling to play an away game.

As you prepare the company playbook for healthier and more productive business traveling, consider the following:

• Providing support for handling jet lag
• Offering advice on maintaining healthy sleep and nutritional habits away from home
• Investing in business class and non-stop flights
• Providing hotels that have conducive amenities for optimal well-being
• Ensuring team members reside in centrally located hotels or apartment hotels

Business travel isn't going anywhere anytime soon, as the average business traveler takes roughly 6.8 trips per year, with business travel in the U.S. from domestic and international travelers also accounting for $387 billion in annual revenue, according to research shared over at Zippia . Incorporating travel wellness initiatives isn't merely an expense; it's an investment in employees' health and performance.

As organizations revamp their corporate travel programs, prioritizing their travelers' well-being is paramount. By implementing strategies to support travel wellness, companies can ensure that their employees remain healthy, engaged, and effective representatives of their companies.

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