Starting Up: Budgeting for Small-Biz Travel

But even if you do plan out your trip, business travel is going to cost you, says Mari Adam, a financial planner in Boca Raton, Fla. After a recent conference in Seattle, in which airfare, a hotel room and registration set her back more than $2,000, she says, "I probably won't do that every month." But, she added, meeting with business contacts and colleagues in similar situations made the trip worth it.

Still, "if you aren't judicious and you spend too much in the beginning, you could run out of money," Adam says. Keep in mind, these types of business-generating strategies don't always pay off right away. It's like a pharmaceutical company investing in research and development: "There can be a long incubation period, in which you might not see evidence of its benefits for some time," she says. With business travel, as with advertising and other marketing costs, "you have to be patient and plan for the long haul," she says.

Business Expense Deductions

According to the Internal Revenue Service, business owners may deduct part or all of the unreimbursed cost of meals, airfare, transportation and hotel stays while traveling. These expenses are usually only deductible if they are deemed to be "ordinary" and "necessary" and your business concerns require you to travel out of town overnight.

"The biggest issue for small businesses is record-keeping," says Bill Fleming, a managing director of private-company services at PricewaterhouseCoopers in Hartford, Conn. At the end of each trip, write purchase descriptions on the back of receipts and staple them to an expense-reporting form, he suggests. If you have employees, develop a policy for substantiating receipts. "Be a real taskmaster about receipts," he says. The good record-keeping will save time, expense and frustration in the event the IRS questions a return. For record-keeping instructions, check out IRS guidelines here .