Kristen, the regional manager for a national hardware chain, is based in Atlanta

Question

Kristen, the regional manager for a national hardware chain, is based in Atlanta. During March and April of this year, she has to replace temporarily the district manager in Jackson, Mississippi. During this period, Kristen flies to Jackson on Sunday night, spends the week at the district office, and returns home to Atlanta on Friday afternoon. The cost of returning home is $550, while the cost of spending the weekend in Jackson would have been $490. 1. Presuming no reimbursement by her employer, how much, if any, of these weekend expenses may Kristen deduct? 2. Would your answer in (a) change if the amounts involved are reversed (i.e., the trip home cost $490; staying in Jackson would have been $550)? Explain.

Explanation / Answer

A.

For this situation expense to stay on Saturday for Jackson is $490 and which is less than flying back to Atlanta. Subsequently Saturday is accounted as business day and Kristen may deduct $490 for tax collection.

The distinction $550 and $490 is an individual cost and non deductible.

B.

For this situation as expense of travelling back is less, Saturday is not viewed as the business day. Subsequently Kristen is permitted to deducted her travel cost of $490 for reason for tax assessment.

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