Boost Your Travel With The following pointers

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Boost Your Travel With The following pointers

Tourism and travel industries have been once again disrupted by the discovery of the newest COVID-19 Omicron variant. The latest update was to reflect the Omicron variant. Lodging charges are fully deductible but if they include meals, then the taxpayer must allocate a portion of the cost of meals to apply the 50% rule.

Their deductibility is subject to the 50% rule as are any separate charges for food or beverages. Entertainment and meals provided as part of an entertainment setting are also subject to the 50% rule. An employee receiving a per diem allowance does not have to allocate expenses between meals. Meals at those facilities may be deductible, however. Credit card statements are adequate for simple expenditures, but not for expenditures where the payment may be for more than 1 thing, such as lodging, because it can also include phone calls or other hotel services.

Entertainment costs for the spouses are generally deductible if the cost of the business associates is deductible, especially for out-of-town customers or potential clients. However, if the rental covers more than 1 game on separate days or a series of games, then the deduction is limited to 50% of what the same number of regular seats would cost.

If the tests are not satisfied, then they may qualify under the goodwill entertainment rules that require a business discussion either before or after the entertainment. There are simple rules that people can violate without thinking. In addition, they can adversely impact global health efforts during a pandemic by disincentivizing countries to report and share epidemiological and sequencing data. “This situation is another reminder of the urgent need for countries to adopt interoperable digital health credentials for testing and vaccination that are mutually recognized across borders.

Club dues, such as for country clubs and athletic clubs are generally not deductible, since dues cover an extended duration and the primary purpose of these clubs is for recreation. The Tax Cuts and Jobs Act has eliminated employer deductions for entertainment, amusement, or recreation expenses, even if they serve a business purpose. Thus, ownership and maintenance of entertainment facilities or clubs are not deductible since they are not considered business facilities and would mostly be used for recreation. There are many forms of entertainment, that because of their nature or because of the environment that they create, are not conducive to promoting business or where it is clear that there is not a primary business motive for providing the entertainment.

Hence, a primary business motive is unlikely. The taxpayer should keep a record of the names of guests, and their business affiliation or relationship to indicate business motive, and a record of the entertainment costs to support deductibility. If the award is for length of service or for safety and it is given under a qualified plan, which is a written plan or program that does not discriminate in favor of highly compensated employees and in which the average cost of all awards given to employees during the year is not greater than $400, then the deductibility limit is $1600 for the year.

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