I am currently a fellow in the Boston area. In 2008, I traveled to California to interview at two hospitals for a subsequent fellowship. My wife joined me so that she could get a feel for whether she would want to practice in California.

We flew into SF and spent a few days in SF and Napa before my first interview in SF. We then flew to LA for my second interview, before flying back to Boston.

I surmise that I can deduct flights and hotels from my 1099 moonlighting income as "job search expenses" given that the second fellowship for which I interviewed would NOT be "a job in a new occupation."

1) I am aware that the IRS could consider the few extra days that we spent in SF and Napa as a personal vacation, even I was "looking for a new job" overall. Should we only deduct the hotel nights that were directly before and after the interviews or could the trip as a whole be considered "looking for a new job"?

2) My wife, who is also a physician, travelled with me to determine if she would want to practice in California, but she did not have a specific interview on that trip. Should we deduct or not deduct her flights?

Thank you.

I found your answer in IRS Publication 463 on deducting travel expenses, available at www.irs.gov:


Trip Primarily for Business

You can deduct all of your travel expenses if your trip was entirely business related. If your trip was primarily for business and, while at your business destination, you extended your stay for a vacation, made a personal side trip, or had other personal activities, you can deduct your business-related travel expenses. These expenses include the travel costs of getting to and from your business destination and any business-related expenses at your business destination.

Example.

You work in Atlanta and take a business trip to New Orleans. On your way home, you stop in Mobile to visit your parents. You spend $1,920 for the 9 days you are away from home for travel, meals, lodging, and other travel expenses. If you had not stopped in Mobile, you would have been gone only 6 days, and your total cost would have been $1,620. You can deduct $1,620 for your trip, including the cost of round-trip transportation to and from New Orleans. The deduction for your meals is subject to the 50% limit on meals mentioned earlier.


The publication also addresses your second question:

Travel expenses for another individual. If a spouse, dependent, or other individual goes with you (or your employee) on a business trip or to a business convention, you generally cannot deduct his or her travel expenses.

Employee. You can deduct the travel expenses of someone who goes with you if that person:
Is your employee,

Has a bona fide business purpose for the travel, and

Would otherwise be allowed to deduct the travel expenses.


Business associate. If a business associate travels with you and meets the conditions in (2) and (3) above, you can deduct the travel expenses you have for that person. A business associate is someone with whom you could reasonably expect to actively conduct business. A business associate can be a current or prospective (likely to become) customer, client, supplier, employee, agent, partner, or professional advisor.

Bona fide business purpose. A bona fide business purpose exists if you can prove a real business purpose for the individual's presence.




I hope this helps you out.

Zip Code: 01801

Thank you very much.