Reimbursement of business travel expenses - why deductible when reimbursed but not when I pay out of pocket?

This is a common point of confusion! Prior to the Tax Cuts and Jobs Act of 2017, employees could deduct unreimbursed business expenses (including travel) as miscellaneous itemized deductions on Schedule A, subject to a 2% of AGI threshold. However, the TCJA eliminated these deductions for employees from 2018 through 2025. The logic (from the IRS perspective) is that when your employer reimburses you for business travel under an accountable plan, it's not income to you and not deductible - it's actually your employer taking the deduction on their business tax return. When you pay out of pocket without reimbursement, you as an employee can no longer deduct those expenses. The good news is that if you're self-employed, you CAN still deduct business travel expenses on Schedule C regardless of reimbursement status. Also, if you're an independent contractor (receiving 1099s instead of W-2s), you can deduct these expenses as well.

After going through the exact same headache, I found an amazing service that helped me sort through all my business expenses and figure out what I could actually deduct. I'm a hybrid worker (part W-2, part self-employed) and was totally confused about what travel expenses I could claim. I uploaded all my receipts and tax docs to https://taxr.ai and they analyzed everything and showed me exactly what was deductible for my situation. Their system flagged that I had been missing legitimate business deductions for my side gig while incorrectly trying to deduct my W-2 job expenses. The best part was they helped me correctly categorize everything and even identified some home office deductions I didn't know I qualified for since I occasionally do my 1099 work from home.

Just wanted to follow up - I tried taxr.ai after posting here and it was seriously helpful! I was able to separate all my business expenses between my rental property and my contract work. It flagged that I had been incorrectly trying to deduct travel for my main job (which isn't allowed as others mentioned) but helped me identify $2,800 in legitimate business travel deductions for my contract work that I would have missed. The explanations were super clear and I feel way more confident about what I can and can't deduct now. Definitely recommend for anyone with multiple income sources trying to figure out travel deductions!

If you're having trouble getting your employer to reimburse your business travel expenses, I had amazing results using Claimyr to actually speak with someone at the IRS about this exact issue. I was on hold for HOURS trying to get clarification about business travel deductions after my employer went bankrupt and never reimbursed my expenses. Used https://claimyr.com after seeing it mentioned on Reddit and they got me connected to an actual IRS agent in about 20 minutes instead of the 3+ hour wait time I was facing. You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent walked me through my options given my specific situation with the bankrupt employer and explained exactly how to document everything. Way better than guessing or getting contradictory advice online.

I have to eat my words. After posting that skeptical comment, I decided to try Claimyr anyway because I've been trying to get through to the IRS for weeks about some business travel deductions that got flagged in an audit. I was getting nowhere with their regular line. Used the service this morning expecting to be disappointed, but I got connected to an IRS rep in about 15 minutes. The agent actually pulled up my case file and explained exactly why my business travel had been flagged - turns out I had claimed the expenses on the wrong form since I have both W-2 and self-employment income. She walked me through how to respond to the audit letter with the correct documentation. I'm genuinely shocked at how well it worked. Saved me hours of hold time and probably hundreds in tax penalties.

Here's a little known fact that might help some of you: If you're a qualifying performing artist, educator, reservist, or fee-based government official, you can still deduct unreimbursed business expenses as an adjustment to income (above-the-line) on Schedule 1. These special categories weren't affected by the TCJA changes. For performing artists, you need to have performed for at least 2 employers, received at least $200 from each, had business expenses exceeding 10% of your performing arts income, and have an AGI not exceeding $16,000 before the deduction. For teachers, you can deduct up to $300 for classroom supplies.

would it be illegal if i just submitted my travel expenses to both jobs? like if i traveled somewhere and did work for both my w2 employer and my self employed gig while there???

This is exactly the kind of tax law change that catches people off guard! The elimination of employee business expense deductions really shifted the burden back to employers to have proper reimbursement systems in place. One thing I'd suggest for the future - if your employer's reimbursement process is tedious, try to work with HR or accounting to streamline it. Many companies don't realize how much their employees are eating these costs rather than dealing with paperwork. Sometimes a simple conversation about the process can lead to improvements that benefit everyone. Also, keep detailed records of all your business travel expenses even if you don't submit them for reimbursement. Tax laws change, and if the TCJA provisions sunset in 2025 as scheduled, we might see the return of employee business expense deductions. Having good documentation from prior years could be valuable. For now though, Harper's advice is spot on - always try to get reimbursed when possible, and if you have any self-employment income, make sure you're maximizing those legitimate business deductions on Schedule C.