Could I Have Traveled to Wakiki and Deducted the Travel Expenses to Attend the WCI Conference Virtually?
Probably Not—Understanding the IRS Rules on Business Travel
I debated whether to go to San Antonio to attend the White Coat Investor Conference in person.
Why?
Because it’s in San Antonio!
What’s there to do? Actually, the Riverwalk was pretty cool.
I also considered signing up for virtual access and watching the conference from Waikiki, enjoying the warm weather and the abundance of delicious Ahi poke.
Hmmm… would that work?
Could I deduct my travel expenses to Hawaii?
I’ll share my thoughts in this article.
The Virtual Conference Tax Strategy – Proposed by a Tax Strategist (not me)
I read a blog where a tax strategist suggested that attending a virtual conference while on a family vacation might be deductible, with reasoning like this:
“If you can show that, because of your busy work schedule, it is difficult to complete your CE and take a vacation separately, combining the two activities may justify the need to complete them together.”
This sounds pretty appealing (great marketing!)—especially if the conference were being held in Des Moines, Iowa, in *freezing* January, and you were watching it from a Hawaii paradise instead.
Would This Work?
My answer: Most likely not.
Reason #1: It Fails the “Necessary” Test
For any business deduction, the expense must be ordinary, necessary, and directly related to business activities. This is established in IRC §162(a).
If I traveled to Hawaii to watch a virtual WCI Conference, my travel expenses would not be deductible because there is no necessary reason to travel —I could have simply watched the conference from home.
Travel could be considered necessary if, hypothetically, the only way to attend the virtual conference was via a big screen set up exclusively at the Aulani Hotel in Oahu.
Reason #2: It Fails the “Primary Purpose” Test
Treas. Reg. §1.162-2(a) states that for travel expenses to be deductible, the primary purpose of the trip must be business-related.
Trying to justify travel to Hawaii to watch a conference taking place in San Antonio would be a tough sell to the IRS.
Would anyone seriously believe that a super busy physician (as described in the excerpt by the tax strategist), who couldn’t even find time to take a separate vacation, would sit on the beach watching a virtual CE course all day long—without being distracted by the waves and the nice looking ladies (and gentlemen) on the beach?
That just doesn’t pass the sniff test.
I highly doubt that an IRS employee—earning a modest salary in Des Moines, Iowa, who takes one vacation every other year—would believe that a busy doctor’s trip to Hawaii was primarily for a virtual conference.
A Small Silver Lining
If I traveled to Hawaii and watched the WCI Conference virtually, I could still deduct the conference registration fee, but essentially nothing else.
Final Thoughts
While it would be amazing if we could travel to vacation destinations, attend a virtual CME course, and deduct the travel expenses, the reality is:
This strategy will likely fail if audited.
The IRS is unlikely to consider travel necessary if the conference can be attended from home.
The IRS will likely view the primary purpose of the trip as a vacation.
So, if you’re planning to take a vacation and watch a virtual conference, enjoy the trip—but don’t expect to write off travel expenses beyond the conference fee!
Disclaimer 1: click here