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Few people like to do their taxes, and as a consequence they'll try to blaze through the tax-paying process as fast as possible. But if you're an in-house lawyer, that's greenbacks left in the hands of the IRS. And as much as people hate doing their taxes, they should hate letting the government keep their dollars.
One of the most common deductions taken are travel related. Here are a few IRS tips that will help you reduce your company's tax liability this season.
Business Travel Expenses
We previously wrote a piece that introduced the bare bones of business travel deductions. But it is also important to keep in mind that only itemized deductions that are higher than two percent of your GIA are deductible.
Note that the rules are more complex for law firm partners -- so much so that you might even need to hire professional help if you happen to be a partner. Partners cannot deduct unreimbursed expenses made on behalf of the law partnership if the firm would have reimbursed those expenses. However, expenses that must be paid out of pocket because the partnership agreement says so may be deducted on your individual return.
Unfortunately, you can't deduct travel expenses associated with going to and from work. However, you can deduct travel expenses to meet clients and attend meetings and seminars. That goes for parking, too. Other reimbursed expenses that are travel-related also include hotels, motels, and other lodging, meals, meals with clients. This even includes expenses for staying places (less than one year) while working away from home.
Here are a few other expenses that attorneys should also keep in mind come time to file taxes.
It would be difficult to overemphasize the need for attorneys to seek the trained advice of a tax professional -- especially for the more "gray area" cases. Avoid taking chances since an improper deduction will raise the suspicions of the IRS.
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.