Lodging expense for a home that I own

Forum|Forum|1 year ago
May 22, 2024
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I own a second home, and I travel there for both work and personal reasons. Can I charge lodging expense (published lodging per diem perhaps) when I stay there solely for work? Usage is approximately 60/40 work vs personal.

Ask the Experts - Biz Tax - May 2024

mirthaguer

Not quite sure I understand your question. Is the second home a vacation or a rental property.? Why do you travel to your second home and work there. Lodging expenses are deductible only if the travel is to see a client, not just because you are traveling. Just traveling to your second home and working part of the time in your second home does not constitute business travel. The deductibility of travel expenses is not if you are travelling and you happen to work, but the travel is to see a client or some other business reason that you must travel to the place.

Greg W62Author

I inherited a house 500 miles away from my home. I travel there for personal reasons to visit three of my children who live about 150 miles away from that house. I also stay there to attend extended family functions at that house several times a year.

I am the majority owner of a C Corp that controls real estate within 15 miles of my inherited house. I travel and stay there several days a month to meet with contractors, meet with a rental agent, purchase new property, and repair, renovate and maintain existing corporate property.

There are some trips that include both personal and business purposes, but most are clearly either one or the other.

KimberW

Based on the additional detail, you can deduct the cost of your trips to manage your C-Corp and its property as a business deduction. The expenses for trips that combine personal and business purposes would need to be prorated depending on the amount of time spent on each purpose during the trip.

And you (as the homeowner) could certainly charge rent to the C-Corp when a C-Corp employee/owner is using the house for business purposes. The per diem rate could be a useful way to set a nightly rate. But then, you (as homeowner) would have to report that income on your personal return.

Your company cannot deduct an expense that it doesn't incur, however. If your company actually pays for your lodging for a business trip, it can deduct that expense. But whoever receives that payment for lodging -- whether a hotel or you as the homeowner -- will have income to report.

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-- KimberW

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