vacation travel tax credit

Travel Tax Credit: Will Uncle Sam Pay You to Take a Vacation?

There's a proposal in Congress to give you an "Explore America" tax credit of $4,000 or more to cover travel expenses. But don't pack your bags quite yet.

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After being cooped up for months at home, who doesn't want to pack their bags and take a vacation? I certainly could use some time lounging on the beach or hiking up a mountain. And the travel industry wants us all to take a trip somewhere, too. Airlines, hotels, restaurants, and other businesses that rely on vacationers have been in the dumps during the coronavirus pandemic. They're looking for anything that will boost their bottom line.

So, how then do you make it easier for Americans to take a vacation and save the travel industry at the same time? How about a tax credit! That's the idea behind a bill introduced in Congress by Sen. Martha McSally (R-AZ). The American Tax Rebate and Incentive Program (TRIP) Act would provide a tax credit of up to $4,000 ($8,000 for married couples filing a joint return), plus an additional $500 for each child age 16 or younger, for your domestic travel expenses. (The credit is also being called the Explore America Tax Credit.)

What Expenses Would Be Eligible for the Credit?

Under the plan, you could claim a tax credit (up to the applicable amount mentioned above) for travel expenses related to:

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• Food and beverages;
• Transportation;
• Live entertainment (including sporting events); or
• Attending a conference or business meeting.

So, your meals and hotel expenses on vacation would be covered. You could even get a credit for your margaritas at the tiki bar. If you fly to your destination, airfare would be counted. If you drive your own car, you could claim the standard mileage rate for business travel as a credit (57.5¢ per mile in 2020). If you rent a car, the rental fee would be added to the total. Going to a show, no problem. Theme park tickets would probably be allowed as well.

There would be a couple of exceptions, though. For example, if you stay at your own vacation home, costs associated with that home (mortgage, interest, maintenance, etc.) would not count as lodging expenses. Any expenses that are also deductible as a business expense would not be eligible for the credit, either.

Where and When Can You Go?

To claim the credit, you would have to travel within the U.S. (including any U.S. territory or possession). Your final destination would also have to be at least 50 miles from your home. In addition, the credit would only be available for travel in 2020 and 2021.

What Are the Chances This Will Pass?

Before you book a trip, you should know that the chances of this bill ever becoming law are slim. President Trump has called for legislation to help the travel industry, and a few Republican senators like the general idea of a travel credit, but at this point the TRIP Act doesn't have widespread support in Congress.

As legislators hash out another stimulus package, a travel credit of some sort could make it's way into a final bill – but don't count on it. So, while you may be dreaming of the vacation of a lifetime, don't pack your bags just yet.

Rocky Mengle was a Senior Tax Editor for Kiplinger from October 2018 to January 2023 with more than 20 years of experience covering federal and state tax developments. Before coming to Kiplinger, Rocky worked for Wolters Kluwer Tax & Accounting, and Kleinrock Publishing, where he provided breaking news and guidance for CPAs, tax attorneys, and other tax professionals. He has also been quoted as an expert by USA Today , Forbes , U.S. News & World Report , Reuters , Accounting Today , and other media outlets. Rocky holds a law degree from the University of Connecticut and a B.A. in History from Salisbury University.

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$4,000 travel tax credit? Here’s how the ‘Explore America’ stimulus proposal could fund your next vacation

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The U.S. economy has started to show some signs of life again. Employment is on the rise and businesses across the country are starting to reopen, but sadly, the fight against COVID-19 still has a ways to go.

Nonetheless, the coronavirus pandemic has sparked one of the sharpest economic downturns since the Great Depression . Regardless of what positives we may be seeing during this initial recovery period, experts say there’s still a long road ahead.

In an effort to keep things on the right track, lawmakers are considering additional forms of aid to help stimulate the economy. One of the proposals being discussed is dubbed the “Explore America” tax credit.

What is the ‘Explore America’ tax credit, and how might it work?

The “Explore America” tax credit was brought up in President Donald Trump’s remarks at a roundtable of restaurant industry executives in May — earning the approval of the Independent Restaurant Coalition and the U.S. Travel Association. The proposal would allow Americans to get a tax credit up to $4,000 on domestic travel, which in turn could help speed up the recovery of the U.S. travel industry.

The tax credit would let individuals claim a credit up to 50 percent of their expenses made at U.S. airlines, rental car companies, theme parks, hotels and restaurants in 2020 and 2021. However, there are still many details that have yet to be answered, so it’s a bit foggy on what this stimulus option could mean for consumers.

Is a travel stimulus plan likely to be approved?

The goal of the “Explore America” bill would be to incentivize consumers to support restaurants, airlines and hotels — all businesses that have taken an especially hard hit because of COVID-19. In fact, it’s estimated that the U.S. travel industry will see a 40 percent drop in spend, according to the U.S. Travel Association.

Given that staggering number, it’s not surprising that tourism boards have cheered the proposal.

“Travel supported jobs for 1 in every 10 Americans before the pandemic, and measures to incentivize travel will not only give people a renewed appreciation for this great country in which we live, but they are an efficient and effective way to ignite a recovery and restore jobs in every corner of the nation,” according to the U.S. Travel Association in a May 19 press release.

Would the tax credit motivate people to travel?

While it would likely provide much-needed relief to tourism workers, the question remains: Would the tax credit be enough to motivate people to travel given the current health and safety risks?

“It’s too far disconnected,” says Francine Lipman, a professor of law at University of Nevada Las Vegas and former CPA. “It would end up being a windfall for people who were going to spend that money anyway, so that doesn’t achieve the goal (of stimulating the economy).”

“If someone isn’t traveling out of fear for the virus, I can’t imagine a tax credit would eliminate that fear,” says Kirk Kinder, CFP and president of Picket Fence Financial in Palm Harbor, Florida. “I also think it would fail in motivating someone who isn’t traveling due to a financial impact (job loss, reduced hours, etc.) because they have to front that money for the travel only to be reimbursed when they file the tax return in early 2021.”

On the contrary, Morris Armstrong, a licensed Enrolled Agent (EA), raises how a travel-focused subsidy would ensure that money is put directly into the economy.

“People who have not been impacted at all, financially, received stimulus checks, and many people have received unemployment benefits in excess of their normal wage. Those payments may wind up in banks or markets and not in the economy,” Armstrong says. “The idea of a travel-related subsidy would ensure that money has to be spent in order to receive any benefit. It is a transfer — money from the consumer to the vendor, be it airline, car rental, hotel or restaurant. In my opinion, that is viable and not much different than an energy credit. You are rewarding the consumer for doing something that is in the interests of the economy.”

Would it be enough, however, to help struggling Americans, or would it mostly benefit those who would have traveled anyway?

“If you’re not working, or worried about your job along with another possible increase in COVID-19 during late fall and winter, you’re just not going to travel,” says David Evangelista, a CPA who specializes in tax and accounting services at MBAF in New York. “The credit will only be realized upon the filing of a taxpayer’s 2020 tax return in 2021 or their 2021 tax return filed in 2022.”

Where the proposed bill stands today

There hasn’t been any major movement on the “Explore America” tax credit proposal in recent months, but it’s still on the table as a part of the Senate’s stimulus bill proposal.

“Now that the Treasury is involved in the negotiations and talks are starting again, I think this specific proposal still has legs,” says Julio Gonzalez, CEO of Engineered Tax Services in West Palm Beach, Florida. “If the House gets state bailout relief funds, I think we’ll see compromise from them on a number of things, including something as bipartisan as this.”

As Gonzalez sees it, the tax credit would promote economic activity rather than add to the national debt. He compares the concept to the solar and wind tax credits currently offered to incentivize citizens to upgrade to more energy-efficient technology.

Featured image by Thomas Barwick of Getty Images.

Learn more:

• Second stimulus check and extended unemployment benefits? Here’s what aid could be on the way
• 401(k) rollover options: Here’s what to do if you lose or change your job
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Fact check: Americans could get a $4,000 tax credit for domestic travel in stimulus

Claim: americans could get a $4,000 tax credit for domestic travel as part of the next stimulus check..

It has been three months since Americans began receiving their $1,200 stimulus checks.

Lawmakers are now considering a second round of relief funding for Americans as coronavirus-related restrictions extend into the summer months and states across the country record climbing case numbers.

One proposal, which President Donald Trump briefly referenced during a roundtable discussion with restaurant executives on May 18, would give Americans willing to travel domestically over the next few months a tax credit to do so.

“Create an ‘Explore America’ — that’s ‘Explore,’ right? Explore America tax credit that Americans can use for domestic travel, including visits to restaurants. That’s a big deal,” Trump said at the meeting, before moving on.

An article on a website called The U.S. Sun headlined “FREE HOLIDAY: Americans may be given a $4,000 vacation credit and another check in next stimulus package,” referencing the Explore America tax credit has gained significant traction on Facebook. 

The June 15 article, written by Janine Phakdeetham, states the plan could help reinvigorate the economy by giving people up to $4,000 in credits for domestic travel-related expenses, such as hotel bookings or meals at restaurants. The U.S. Sun is an American version of the British tabloid The Sun, published by News UK , a subsidiary of News Corp.

“The credit period would last up through the end of 2021,” the article said.

Where did the idea of an ‘Explore America’ tax credit come from?

The U.S. Sun’s claims the potential travel tax credit would be worth up to $4,000 and that it could be used until the end of 2021 are unsourced, but could have originated with a list of legislative priorities published by the U.S. Travel Association . USA TODAY reached out to the U.S. Sun and did not receive a response.

The U.S. Travel Association’s legislative priorities list, which was last updated on May 20, suggests a temporary travel tax credit could “incentivize a safe reopening of the travel economy.”

“To reduce the time it takes to get to full recovery, Congress should create a new tax credit to encourage domestic business and leisure travelers to travel within a specified time frame, similar to what was done through the homebuyer tax credit in the wake of the housing crisis,” the document stated.

More: Traveling this summer? These 12 things will keep you safe and comfortable

Tori Emerson Barnes, executive vice president of public affairs and policy at the U.S. Travel Association, said her organization began investigating tools that could help the travel industry recover from a pandemic-related downturn in January and February, looking back to previous crises, including the Great Recession, for guidance.

Emerson Barnes said the travel industry is facing economic devastation nine times worse than the post-9/11 downturn. Americans are starting to venture out in cars for regional trips, she added, but as many as a third of travelers likely won’t feel comfortable traveling without a vaccine.

“In 2019, we had 15.9 million travel related jobs, and as of May 1st, we've lost 8.1 million jobs,” Emerson Barnes told USA TODAY. “So it's quite, quite significant.”

A travel tax credit, she said, could push Americans on the fence about booking a trip over the edge, giving businesses on the brink of failure the revenue they need to weather the storm, or even hire back employees laid off in recent weeks.

More: The best travel credit cards of 2020

In its legislative priorities document, the U.S. Travel Association proposes a tax credit worth 50% of qualified travel expenses incurred in the U.S. between the date of enactment and Dec. 31, 2021. Qualified expenses should include any expense over $50 made while traveling away from home that makes explicit reference to meals, lodging, recreation, transportation, amusement or entertainment, business meetings or events and gasoline, the document read.

The U.S. Travel Association suggested a maximum credit of $4,000 per household.

Are lawmakers considering a temporary travel tax credit?

Emerson Barnes said lawmakers on both sides of the aisle have expressed interest in the tax credit, including Senate Minority Leader Chuck Schumer, D-N.Y. USA TODAY reached out to Schumer’s office for comment and did not receive a response.

A June 16 article published by the McClatchy Washington Bureau said Democratic lawmakers contacted by reporters were unfamiliar with the proposal, but reporters confirmed that a temporary travel tax credit is “actively” being considered by the White House for inclusion in the next coronavirus stimulus package. 

More: Common travel activities: What's the coronavirus risk?

White House officials told McClatchy that the amount of the tax credit and the time frame during which Americans could use it remains undecided. “The tax break is still under discussion and is not guaranteed to be included in the legislative package the White House presents to Congress,” the article states.

Sen. Martha McSally, R-Ariz., proposed a bill on June 22 called the American TRIP Act that would grant vacation tax credits up to $4,000 per American adult or $8,000 per married couple, plus $500 for each dependent child, Forbes reported .

The most recent legislative economic relief package passed by the U.S. House of Representatives, which has a Democratic majority, included no such tax credit.

USA TODAY reached out to the White House for comment and did not receive a response.

More: Are more stimulus checks coming? Trump signals support for another round of cash payments

Would a travel tax credit stimulate the economy?

Economic experts are skeptical of using a temporary tax credit for travel to stimulate the economy.

Chris Edwards, director of tax policy studies for the Cato Institute, a libertarian think tank, called it “a terrible idea,” adding that it would be a nightmare to implement.

“It would add complexity to the tax code,” Edwards told USA TODAY. “What is the definition of travel? It's a good example of something that is far from black and white. Is it gas for your car? Is it car repairs? Is it food for the trip? You can imagine endless battles between the IRS and taxpayers claiming this.”

Though Emerson Barnes argues the travel industry was disproportionately impacted by the virus from the start of the crisis, when countries began closing their borders and banning large gatherings, Edwards cautioned against instituting a credit that benefits one industry over others.

More: This is where the money is coming from to rescue the US economy

“It's unfair for the federal government to pick certain industries to bail out and other ones not to bail out,” Edwards said. “That's an advantage of something like unemployment insurance compensation. Everyone who is unemployed gets it regardless of what industry they're in. So if we're going to do any aid, it should be that sort of simple and equal aid for everyone.”

Is a travel credit the best approach?

Garrett Watson, senior policy analyst at the Tax Foundation, a Washington, D.C.-based think tank, told USA TODAY he’s seen greater interest in making the Paycheck Protection Program available to more businesses and rethinking the next iteration of unemployment aid provided by the CARES Act, the first COVID-19 relief package. The idea of including rehiring bonuses in the second round of relief has also gained traction with lawmakers who believe enhanced unemployment benefits disincentivize work, he said.

Watson and Edwards also pointed out that a tax credit for travel could distort normal consumer behavior.

“The government shouldn't be encouraging people to travel if they don't want to,” Edwards said. “That doesn't make any sense. If people feel unsafe, then they should stay home.”

Our ruling: True

The U.S. Sun article stated that Americans could get a $4,000 tax credit to spur travel to be used by the end of 2021, a plan that may help reinvigorate the economy and lift the tourism industry. It is TRUE that such a plan has been proposed. But experts are skeptical the credit will make it into the next pandemic relief package.

Our fact-check sources

• The U.S. Sun,  FREE HOLIDAY Americans may be given a $4,000 vacation credit and another check in next stimulus package
• Remarks by President Trump , May 18, 2020
• U.S. Travel Association Legislative Priorities
• McClatchy,  White House considers tourism tax break for Americans wary of vacations in pandemic

Thank you for supporting our journalism. You can subscribe to our print edition, ad-free app or electronic newspaper replica here.

Our fact check work is supported in part by a grant from Facebook.

U.S. Travel Tax Credit Would Cover Vacation Expenses up to $4,000

The U.S. travel tax credit proposed by President Trump in 2020 would have covered up to 50 percent of travel expenses for people up to $4,000.

Jan. 15 2021, Published 2:15 p.m. ET

The travel industry took a huge hit during the COVID-19 pandemic. With people social distancing and complying with stay-at-home orders, traveling all but disappeared in 2020. Also, since many people lost their jobs, they didn't have money to travel. 

In May 2020, President Trump proposed a tax credit for domestic travel that could have helped the travel industry. The tax credit would have encouraged more people to travel and it would have allowed some people to go back to work. 

What is the 2020 travel tax credit and how does it work?

During the summer of 2020, President Trump proposed the idea of a travel tax credit. During a roundtable discussion with restaurant executives , he said, "Create an ‘Explore America’ — that’s ‘Explore,’ right? Explore America tax credit that Americans can use for domestic travel, including visits to restaurants. That’s a big deal." 

The next month, an article in The U.S. Sun stated that the travel credit would be up to $4,000 and could be used until the end of 2021. The credit was meant to cover the cost of hotel stays, visiting restaurants, theme parks, and other travel-based expenses for domestic travel.

Travel tax credit's intent

According to Bankrate , the tax credit was meant to cover up to 50 percent of any travel expenses over $50 within the U.S. to help keep money in the travel industry. The industry has been struggling amid the coronavirus pandemic. When it's time to file taxes, people would be able to claim the credit and have at least some of the costs covered. 

In a May 2020 press release, the U.S. Travel Association said, "Travel supported jobs for 1 in every 10 Americans before the pandemic, and measures to incentivize travel will not only give people a renewed appreciation for this great country in which we live, but they are an efficient and effective way to ignite a recovery and restore jobs in every corner of the nation." 

Currently, the travel industry is losing a lot of money. According to Forbes , the industry brought in $2.6 trillion and 15.8 million American jobs. As of June 2020, 40 percent of jobs lost in the country through April were in the travel industry. 

How long the travel tax credit would be good for

Initially, the tax credit would have been good until the end of 2021, but since it didn't get passed in 2020, the deadline might change if something like it gets approved in 2021. 

Certain stocks would benefit from the travel tax credit

Any stocks in the travel industry could benefit from the tax credit, but other related stocks may also see a boost in price. For example, fuel companies could benefit from the tax credit including a company like Albemarle , which produces lithium used in many electric car batteries. 

Retail stocks would probably benefit from the tax credit because people would need to buy things before they travel. Also, many people like to shop while they're traveling. Institutions developing coronavirus vaccines like AstraZeneca could benefit from increased travel and people's desire to be safe.

The fashion industry also took a hit during the coronavirus pandemic. Many people chose to focus on buying things they could do indoors. A travel credit could change that because people would have an excuse to buy new clothes. 

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How to claim your Ontario Staycation Tax Credit and get money back

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With tax season fast approaching, here's a reminder to apply for the refundable Ontario Staycation Tax Credit  when filing your personal income tax, so you can get some money back on your return.

If you're an Ontario resident and stayed at eligible lodging within the province in 2022, you could get back up to 20 per cent of your Ontario accommodation expenses, claiming up to $1000.

Staycation Tax Credit Ontario 2022: Dig out those receipts for every HOTEL, AIRBNB, VRBO you stayed at in 2022 and include them in your income tax paperwork to your tax preparer! It's a 'refundable tax credit' so even if you don't pay taxes, you are eligible for some fund back! — Instaccountant 🍁 (@1instaccountant) January 18, 2023

Those with a spouse, common-law partner, or children can claim up to $2000 as a family. That's a credit of $400 just for vacationing within Ontario.

Who is eligible for the credit?

The credit applies to leisurely stays in the province between January 1 and December 31, 2022, and includes Airbnb rentals.

To be eligible, you must have been an Ontario resident on December 31, 2022 and the expenses must meet the following requirements: 

• Stay was less than a month at an eligible accommodation such as a hotel, motel, resort, lodge, bed-and-breakfast establishment, cottage, campground, or vacation rental property in Ontario
• Stay occurred between Jan. 1 and Dec. 31 of 2022
• Stay was for leisure purposes (expenses incurred for educational or business purposes do not qualify)
• Accommodation was paid for by the Ontario tax filer, their spouse or common-law partner, or their eligible child, as set out on a detailed receipt provided by the supplier that is registered for the GST and HST

How to claim the credit when filing

When you go to file your personal income tax, make sure you have your detailed travel receipts to submit for stays within Ontario in 2022.

When filing your Personal Income Tax and Benefit Return for 2022, you'll see the Ontario Staycation tax credit on form ON479. The refundable credit will appear on your Federal tax return.

The credit is not being renewed

Unfortunately, the Ford government ended the Ontario Staycation Tax Credit for 2023. The Ontario Minister of Tourism, Neil Lumsden, said it was a temporary one-year measure to help the industry recover after being hit hard by lockdowns.

Tourism operators and opposition critics have called for its extension, and are disappointed the credit was not renewed. The tourism sector is still struggling to come back to pre-pandemic levels, and such an incentive would continue to help bolster the industry.

Jesse Milns

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Ontario Staycation Tax Credit

Find out how to get back up to 20% of your eligible 2022 Ontario accommodation expenses.

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The temporary Ontario Staycation Tax Credit for 2022 aims to encourage Ontario families to explore the province, while helping the tourism and hospitality sectors recover from the financial impacts of the COVID‑19 pandemic.

Ontario residents can claim 20% of their eligible 2022 accommodation expenses, for example, for a stay at a hotel, cottage or campground, when filing their personal Income Tax and Benefit Return for 2022. You can claim eligible expenses of up to $1,000 as an individual or $2,000 if you have a spouse, common-law partner or eligible children, to get back up to $200 as an individual or $400 as a family.

The credit will provide an estimated $270 million in support to about 1.85 million Ontario families.

Who is eligible

You are eligible to claim the credit if you are an Ontario resident on December 31, 2022.

Only one individual per family can claim the credit for the year. Your claim can include the eligible expenses of your spouse or common-law partner and your eligible children. An eligible child is not entitled to claim the credit.

If you do not have a spouse or common-law partner, or eligible child, you can claim your own eligible expenses for the credit.

Eligible expenses

You can claim the Ontario Staycation Tax Credit for accommodation expenses for a leisure stay of less than a month in Ontario, at a short-term accommodation or camping accommodation, such as a:

• bed-and-breakfast establishment
• vacation rental property

The tax credit only applies to leisure stays between January 1, 2022, and December 31, 2022, regardless of the timing of payment for the stays.

The accommodation expenses must have been paid by you, your spouse or common-law partner, or your eligible child, as set out on a detailed receipt provided by a supplier registered for the Goods and Services Tax ( GST )/Harmonized Sales Tax ( HST ).

As long as all other conditions are met, you can claim any of the following expenses:

• accommodation for a single trip or multiple trips, up to the maximum expense limit of $1,000 as an individual or $2,000 as a family
• accommodations booked either directly with the accommodation provider or through an online accommodation platform
• the portion of the expense that is necessary to have access to the accommodation
• the accommodation portion of a tour package expense

You must keep your detailed receipts for any eligible expenses you claim for the credit. Those receipts must include:

• the location of the accommodation
• the amount that can reasonably be considered to be for the accommodation portion of a stay
• the amount of any GST / HST  paid
• the date of the stay
• the name of the payor

Ineligible expenses

Short-term accommodation would generally not include a timeshare agreement, or a stay on a boat, train or other vehicle that can be self-propelled.

The tax credit cannot be claimed for:

• travel expenses that are not for short-term accommodation or camping accommodation, such as expenses for car rentals, fuel, flights, groceries, parking, or prices of admission into local attractions and places of interest
• accommodation expenses reimbursed to you, your spouse or common-law partner, or your eligible child, by any person, including by a friend or an employer
• expenses that are incurred for school or educational purposes, or for a work, employment or business purpose, or that can be claimed for a medical expense tax credit

How to claim the credit

You can claim the credit on your personal Income Tax and Benefit Return for 2022.

The Ontario Staycation Tax Credit is a refundable personal income tax credit. This means that if you are eligible, you can get this tax credit regardless of whether you owe income tax for 2022.

Contact the Canada Revenue Agency

If you have questions about the tax credit, please contact the Canada Revenue Agency

• phone, at  1-800-959-8281
• at a tax services office or tax centre

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Ontario announces plan for staycation tax credit and here's how it works

Tobermory, Ont. is seen in this undated photo. (Flickr)

Sean Davidson , CTVNewsToronto.ca Managing Digital Producer

@SeanDavidson_

The Ontario government has announced its plan for a staycation tax credit.

Anyone planning a getaway within the province in the 2022 tax year could be eligible under the new " Ontario Staycation Tax Credit " program.

The program was announced as part of the Ford government's Fall Economic Statement , which was tabled on Thursday.

Ontarians would get a 20 per cent personal income tax credit on eligible accommodation between Jan. 1 and Dec. 31, up to a maximum of $1,000 for an individual and $2,000 for a family, for a maximum credit of $200 or $400 respectively. 

Ontario residents could apply for this refundable credit when they file their 2022 personal tax returns and benefit even if they do not owe any tax.

According to the government, an eligible accommodation expense would have to be:

• For a stay of less than a month at an eligible accommodation such as a hotel, motel, resort, lodge, bed-and-breakfast establishment, cottage or campground in Ontario
• For a stay between Jan. 1 and Dec. 31 of 2022
• Incurred for leisure
• Paid by the Ontario tax filer, their spouse or common-law partner, or their eligible child, as set out on a detailed receipt
• Not reimbursed to the tax filer, their spouse or common-law partner, or their eligible child, by any person, including by a friend or an employer
• Subject to Goods and Services Tax (GST)/Harmonized Sales Tax (HST), as set out on a detailed receipt.

The government said this tax credit will help the tourism and hospitality sectors recover and encourage Ontarians to explore the province. 

The credit would provide an estimated $270 million to support over one-and-a-half million families to further discover Ontario, the government said.

Ontario NDP Leader Andrea Horwath said Thursday she believes the staycation credit won't help families and says it should have been a full $1,000 refund on costs spent on a vacation in the province. 

"This thing that is in the update today - about $200 is what it comes out to - that's really not going to help families a great deal," Horwath said. "That's why our $1,000 tax credit idea might be helpful to some families who normally would have taken that vacation right now."

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Tax Day is April 15. Find fast, hassle-free tax filing right here. It's just $50 — no hidden costs or fees.

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22 Popular Tax Deductions and Tax Breaks for 2023-2024

Many or all of the products featured here are from our partners who compensate us. This influences which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money .

Tax benefits are generally broken into two major categories: tax deductions and tax credits. As you examine programs that could potentially apply to you, it's a good idea to know the differences in how tax savings can work.

In short, a tax credit gives you a dollar-for-dollar reduction in the amount of tax you owe. A tax deduction, also sometimes called a tax write-off, provides a smaller benefit by allowing you to deduct a certain amount from your taxable income.

Another consideration with tax deductions is that they won't do you much good unless you itemize your deductions, which only makes sense for people with a considerable amount of deductible expenses.

Need a primer first? Jump down to:

How tax deductions and tax write-offs work

How to claim tax deductions

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22 popular tax deductions and tax breaks

Here are some of the most popular tax breaks for the 2024 tax filing season, and links to our other content that will help you learn more.

1. Child tax credit

The child tax credit , or CTC, is a tax break for families with children below the age of 17. To qualify, you have to meet certain income requirements as well. The 2023 child tax credit (taxes filed in 2024) could get you up to $2,000 per child, with $1,600 of the credit being potentially refundable.

Note: The Tax Relief for American Families and Workers Act of 2024, currently awaiting Senate approval, seeks to expand the refundable amount to $1,800 on 2023 taxes .

2. Child and dependent care credit

The child and dependent care credit , or CDCC, is meant to cover a percentage of day care and similar costs for a child under 13, a spouse or parent unable to care for themselves, or another dependent so you can work. Generally, it's up to 35% of $3,000 of expenses for one dependent or $6,000 for two or more dependents.

3. American opportunity tax credit

The American opportunity tax credit , sometimes shortened to AOC, lets you claim all of the first $2,000 you spent on tuition, books, equipment and school fees — but not living expenses or transportation — plus 25% of the next $2,000, for a total of $2,500.

4. Lifetime learning credit

The lifetime learning credit lets you claim 20% of the first $10,000 you paid toward tuition and fees, for a maximum of $2,000. Like the American opportunity tax credit, the lifetime learning credit doesn’t count living expenses or transportation as eligible expenses. You can claim books or supplies needed for coursework.

5. Student loan interest deduction

The student loan interest deduction lets borrowers write off up to $2,500 from their taxable income if they paid interest on their student loans.

6. Adoption credit

The adoption credit is a nonrefundable tax break that helps taxpayers cover a certain amount of qualified adoption costs per child. The credit begins to incrementally decrease at certain income levels and completely phases once your modified adjusted gross income (MAGI) exceeds the given threshold for that tax year. For 2023 (taxes filed in 2024), the credit maxes out at $15,950. The credit is phased out at MAGI of $279,230 or more.

7. Earned income tax credit

This earned income tax credit (EITC) is a refundable tax break for low-income taxpayers with and without children. For 2023 (taxes filed in 2024), the credit ranges from $600 to $7,430, depending on how many kids you have, your marital status and how much you made.

8. Charitable donation deduction

If you itemize, you may be able to write off the value of your charitable gifts — whether they’re in cash or property, such as clothes or a car — from your taxable income. Per the IRS, you can generally deduct up to 60% of your adjusted gross income.

9. Medical expenses deduction

In general, you can write off qualified, unreimbursed medical expenses that are more than 7.5% of your adjusted gross income for the tax year.

10. Deduction for state and local taxes

You may deduct up to $10,000 ($5,000 if married filing separately) for a combination of property taxes and either state and local income taxes or sales taxes through a tax break known as the SALT deduction .

11. Mortgage interest deduction

The mortgage interest tax deduction is touted as a way to make homeownership more affordable. It cuts the federal income tax that qualifying homeowners pay by reducing their taxable income by the amount of mortgage interest they pay.

12. Gambling loss deduction

Gambling losses and expenses are deductible only to the extent of gambling winnings . So, spending $100 on lottery tickets isn’t deductible — unless you win, and report, at least $100, too. You can’t write off more than the amount you win.

13. IRA contributions deduction

You may be able to deduct contributions to a traditional IRA , though how much you can deduct depends on whether you or your spouse is covered by a retirement plan at work and how much you make.

14. 401(k) contributions deduction

The IRS doesn’t tax what you divert directly from your paycheck into a traditional 401(k) . In 2023, you could contribute a maximum of $22,500 ($30,000 if 50 or older). In 2024, that limit rises to $23,000 ($30,500 for those 50 and above).

These retirement accounts are usually sponsored by employers, although self-employed people can open their own 401(k)s .

15. Saver’s credit

The saver's credit runs 10% to 50% of up to $2,000 ($4,000 if filing jointly ) in contributions to an IRA, 401(k), 403(b) or certain other retirement plans. The percentage depends on your filing status and income.

16. Health savings account contributions deduction

Contributions to HSAs are tax-deductible , and the withdrawals are tax-free, too, as long as you use them for qualified medical expenses.

17. Self-employment expenses deduction

There are many valuable self-employment tax write-offs for freelancers, contractors and other self-employed people.

18. Home office deduction

If you use part of your home regularly and exclusively for business-related activity, the IRS lets you write off certain home office deductions for associated rent, utilities, real estate taxes, repairs, maintenance and other related expenses.

19. Educator expenses deduction

If you’re a school teacher or other eligible educator, you can deduct up to $300 spent on classroom supplies. Spouses who are both educators and file jointly get a deduction of $300 each, making them eligible to claim up to $600 on their return.

20. Solar tax credit

The solar tax credit , also known as the "residential clean energy credit," can get you up to 30% of the installation cost of solar energy systems, including solar water heaters and solar panels.

21. Energy efficient home improvement tax credit

The energy efficient home improvement tax credit , revamped under the Inflation Reduction Act, allows homeowners who purchased qualifying home upgrades, such as energy-efficient window, doors and heat pumps, to recoup up to $3,200 on those investments when they file their tax returns.

22. Electric vehicle tax credit

The nonrefundable EV tax credit ranges from $3,750 to $7,500 for tax year 2023. Taxpayers can also get a credit of up to $4,000 for used cars. Eligibility depends on a number of rules, including income, price of the vehicle and whether the car meets IRS manufacturing guidelines for qualified EVs.

» MORE: What other tax credits can I qualify for?

What are tax deductions?

A tax deduction or tax write-off lowers your taxable income and thus reduces your tax liability. You subtract the amount of the tax deduction from your income, making your taxable income lower. The lower your taxable income, the lower your tax bill.

The IRS allows taxpayers to lower their taxable income by choosing either the standard deduction or itemized deductions. Before that, you can also make certain adjustments to your gross income by taking above-the-line deductions in order to arrive at what's called your adjusted gross income .

Above-the-line deductions

Contributions to a retirement account, health savings account contributions or student loan interest payments are referred to as "above-the-line" deductions, but it may be easier to think of them as "adjustments" to your income. These deductions are subtracted from your gross income to determine your adjusted gross income, or AGI . If you qualify, you can take them regardless of whether you itemize or take the standard deduction. Your AGI is important because it is the starting point for calculating your tax bill and also the basis on which you might qualify for many deductions and credits.

Below-the-line deductions

Below-the-line deductions, on the other hand, are qualified expenses that are subtracted from your adjusted gross income to help determine your taxable income. The IRS lets you take either the standard deduction or itemize. There are dozens of itemized deductions available to taxpayers and all of them have different rules. Examples of itemized deductions include deductions for unreimbursed medical expenses, charitable donations, and mortgage interest. Whether you choose to itemize or take the standard deduction depends largely on which route will save you more money.

» MORE: Itemized deductions vs. the standard deduction

What are tax write-offs?

The IRS doesn't use the term "tax write-offs" anywhere in the Internal Revenue Code, but the phrase has gained popularity as a synonym for "tax deduction" over the years. If you hear someone talking about a tax write-off, they're probably referring to certain qualified expenses — or deductions — that itemizers can take to lower their taxable income.

A tax credit , on the other hand, is a dollar-for-dollar reduction in your actual tax bill. A few credits are refundable, which means if you owe $250 in taxes but qualify for a $1,000 credit, you’ll get a check for the difference of $750. Most tax credits, however, aren’t refundable.

A tax credit can make a much bigger dent in your tax bill than a tax deduction, and you don't have to itemize to claim a credit.

» MORE: Tax credits vs. tax deductions

How do you claim tax deductions?

Generally, there are two ways to claim tax deductions: Take the standard deduction or itemize deductions. You can’t do both.

The standard deduction is a flat-dollar, no-questions-asked reduction in your adjusted gross income . The amount you qualify for depends on your filing status. You can learn more about standard deduction amounts here. People 65 or older, or who are blind, get a bigger standard deduction.

Itemized deductions let you cut your taxable income by taking any of the hundreds of available tax deductions you qualify for. The more you can deduct, the less you’ll pay in taxes.

The standard deduction has gone up significantly in recent years, so you might find that it's the better option for you now even if you've itemized in the past. Your tax software or tax preparer can run your return both ways to see which method produces a lower tax bill.

» Ready to file? Check out NerdWallet's top picks for tax software

A tax credit is a dollar-for-dollar reduction in your actual tax bill. A few credits are refundable, which means if you owe $250 in taxes but qualify for a $1,000 credit, you’ll get a check for the difference of $750. Most tax credits, however, aren’t refundable.

A tax credit can make a much bigger dent in your tax bill than a tax deduction.

"Tax rebate" is another term that lacks a formal IRS definition. It generally refers to a phenomenon where a federal, state or local government decreases taxes retroactively (in other words, after the tax filing deadline for a particular year), and then refunds taxpayers the amount that they overpaid under the new rules.

Tax rebates are a bit like refundable tax credits in that they involve getting money back from the government. But a tax rebate is typically mailed to taxpayers automatically, with no action required. To claim a refundable tax credit, on the other hand, a taxpayer generally has to file a tax return, and then receive the tax credit at refund time.

That's another difference between tax rebates and tax credits — timing. Taxpayers generally only receive refundable tax credits during tax refund season, while tax rebates can happen at any time of year.

There have only been a handful of federal tax rebates in recent history, but they're a relatively common occurrence among state and local governments.

On a similar note...

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Line 25500 - Determine your maximum deduction

The maximum deduction you can claim for each eligible trip is the lowest of the following three amounts:

• either the  taxable travel benefits you received from employment for the trip or the portion of the $1,200 standard amount for the person travelling (you or your eligible family member) that you allocate to the trip (enter the amount for whichever option you choose in Step 3 , Chart B – column 3 of Form T2222 )

You can use the value of taxable travel benefits provided by your employer in the calculation in Step 3 if you meet both of the following conditions:

• You are an employee dealing at arm's length with your employer
• You had to include in your income (in the same year you have the travel expenses) the taxable travel benefits that you received from your employment in a prescribed zone

If you take a trip that begins and ends in one year and you are reimbursed the following year, you cannot claim the travel deduction for that trip. However, you can claim a travel deduction if you leave on a trip in one year and return the next year.

For example, you may leave on a trip in December and come back in January. If you receive non-refundable tickets or travel vouchers, the taxable travel benefit should be included in your T4 or T4A slip for the year the trip begins.

• the total travel expenses paid for the trip (enter the amount in Step 3 , Chart B  – column 4 of Form T2222 )
• the cost of the lowest return airfare available at the time of the trip between the airport closest to your residence and the nearest designated city to that airport (enter the amount in Step 3 , Chart B – column 5 of Form T2222 )

If you or an eligible family member uses the standard amount to calculate a travel deduction in the year, $1,200 is the maximum total amount that may be claimed for each individual who travels, for all trips taken in the year by that individual.

Regardless of whether you or an eligible family member is claiming the travel deduction and whether trips were medical or non-medical , it is an amount per person, not per trip.

If you or an eligible family member uses the taxable travel benefit received from employment to calculate a travel deduction in a year for an individual, then no one (including the individual) can use any part of their $1,200 standard amount in calculating a travel deduction claim for any trip taken by that individual in that year.

You can claim a travel deduction even if you are not claiming a residency deduction. For example, if your spouse or common-law partner claims both the basic and the additional residency amounts, you can still claim a travel deduction.

You cannot claim a travel deduction if either of the following applies:

• You or your eligible family member received or was entitled to receive non-taxable amounts as travel assistance, as a travel allowance, or as a reimbursement for travel expenses
• Someone else has already claimed the travel deduction for this trip on their return

How many trips can you claim

You can claim up to two trips  taken for non-medical reasons and up to two trips taken by each eligible family member.

You can also claim any number of medical trips taken by you or an eligible family member. However, no more than two non-medical trips taken by any individual (themself or an eligible family member) in a year can be claimed by all taxpayers combined.

Taxable travel benefits

Taxable travel benefits include:

• travel assistance, such as airline tickets or a trip on a company-owned airplane
• a travel allowance or lump-sum payment you received from your employer for travel expenses you incurred

Payments from your employer for travel that was not for employment purposes are generally considered taxable benefits. Box 32 of your T4 slip or box 028 of your T4A slip shows the taxable travel benefits you received in the year. This includes the benefits received specifically for medical travel which are shown in box 33 of your T4 slip or box 116 of your T4A slip .

You can use the benefit for medical travel in the calculation in Step 3, Chart B – column 3 of Form T2222 only if the medical services were for you or an eligible family member and were not available where you lived.

If you received a benefit that was not for any particular trip, you have to split it reasonably between the trips you are claiming.

Travel expenses

Travel expenses include:

• air, train, and bus fare
• vehicle expenses
• hotel or motel accommodations
• camping fees
• other incidental expenses such as taxis and road or ferry tolls

To calculate meal and vehicle expenses, you may choose the detailed or simplified method. Your total travel expenses equal the total of the value of travel assistance provided by your employer and the travel expenses incurred by you. Include any travel expenses paid by your employer. For more information about the detailed or simplified methods including the different rates, go to Meal and vehicle rates used to calculate travel expenses for 2023  or call 1-800-267-6999 .

If you are claiming expenses for a medical trip on Form T2222 , no one (including you) can claim them as medical expenses on their return.

In cases of medical travel, if the patient needs an attendant while travelling, the attendant's travel expenses are included as part of the patient's total travel expenses. This includes travel assistance provided by your employer or actual expenses you incurred.

If the attendant was you or an eligible family member: Include the cost of the attendant's lowest return airfare in Step 3 , Chart B – column 5 of Form T2222 , as part of the patient's expense for airfare. Include the cost of the attendant's travel expenses (excluding airfare) in column 4 , as part of the patient's travel expenses.

If the attendant was not you or an eligible family member: Do not include the cost of the attendant's lowest return airfare in column 5 as part of the patient's expense for airfare. Include the cost of the attendant's travel expenses (including airfare) in column 4 as part of the patient's travel expenses.

Lowest return airfare (LRA)

The LRA available at the time of the trip means the LRA ordinarily available for regularly scheduled commercial flights (excluding promotions or discounts that are not ordinarily available) on the date that the travel began. The airfare includes any airport tax, as well as goods and services tax / harmonized sales tax and provincial sales tax. Additional charges, such as flight cancellation insurance, meals, and baggage surcharges are not considered part of the lowest return airfare.

To complete  column 5 in Chart B  of  Form T2222 , Northern Residents Deductions , you must submit a lowest return airfare. To determine that airfare, you can use one of the following methods:

• Use the cost of airfare for a round trip from the airport closest to your residence to the nearest designated city. In case the Canada Revenue Agency (CRA) asks for proof of the cost, keep your receipts and any supporting documents.
• Use the amount in the lowest return airfare table which corresponds to your travel date and the airport closest to your residence. With this option, you do not need to have an airfare quote or any receipts or supporting documents.

Example 1 – Using the airfare table

Charlie has been living in Rankin Inlet, Nunavut, for the past three years. They travelled from Rankin Inlet to Iqaluit, Nunavut, to visit family on February 28 and returned on March 16 .

To calculate the travel deduction, Charlie needs to first figure out the three required amounts and enter them on Form T2222 . The cost of their flights was $1,633 and they did not have any other travel expenses. Charlie received a taxable travel benefit from their employer of $1,000.  Since Charlie did not take any other trips in the same year, they decide to use the full $1,200 standard amount instead of the taxable travel benefit they received from their employer, because that benefit is less than the $1,200 standard amount. Although Charlie did not travel to the nearest designated city nor did they leave the territory, they still have to determine the lowest return airfare (LRA) at the time of their trip. Charlie did not obtain a quote before they traveled. However, Charlie checks the table and uses the airfare table amount. The airfare table amount for Rankin Inlet to Winnipeg is $3,143.

Now that Charlie has obtained the three amounts, they can calculate their travel deduction. The maximum that Charlie can claim is the lowest of the following three amounts:

• the taxable travel benefit they received from their employer for the trip or the part of the $1,200 standard amount that Charlie allocated to that trip ($1,200)
• the total travel expenses paid for the trip ($1,633)
• the LRA available at the time of the trip between the airport closest to their residence and the nearest designated city to that airport ($3,143)

The CRA would accept Charlie’s amount for the LRA, because they chose to use the airfare table amount.

They will claim $1,200 for their trip, because it is the lowest of the three amounts.

Example 2 – Travelling by charter

Alex has always lived in Aklavik, Northwest Territories . They travel to Edmonton, Alberta, for a vacation and it is the only trip they take in the year. Alex can only travel from Aklavik by charter. The cost of the charter flights to the nearest commercial airport in Inuvik and back was $2,600. The cost of the flights from Inuvik to Edmonton and back was $1,210. Edmonton also happens to be the nearest designated city when flying from Inuvik. Alex spent an additional $1,000 for travel expenses in Edmonton. Alex received $2,000 as a taxable travel benefit from their employer.

To calculate the travel deduction, Alex needs to first figure out the three required amounts and enter them on Form T2222 . Since the taxable travel benefit Alex received from their employer is greater than the $1,200 standard amount, they decide to claim the taxable travel benefit. Alex bought economy tickets for the flights from Inuvik to Edmonton and back. Alex’s total flight expenses were $3,810. Their total travel expenses were $4,810.

Since Alex has all of the information they need, they can calculate their travel deduction. The maximum that Alex can claim is the lowest of the following three amounts:

• the taxable travel benefit they received from their employer for the trip or the portion of the $1,200 standard amount that Alex allocated to that trip ($2,000)
• the total travel expenses paid for the trip ($2,600 + $1,210 + $1,000 = $4,810)
• the lowest return airfare (LRA) available at the time of the trip, between the airport closest to his residence and the nearest designated city to that airport ($2,600 + $1,210 = $3,810)

The CRA would accept the amount of $3,810 as the LRA, because the charter flight was to the nearest commercial airport and the flight from Inuvik to Edmonton was to the nearest designated city. If Alex is selected for review, they will need to provide their receipts for the flights to support their claim for the LRA.

Alex claims $2,000 for this trip, because it is the lowest of the three amounts.

Example 3 – Quote obtained before the day of travel

Chris has lived in Dawson City , Yukon, for the past 10 years. They drove to Whitehorse, Yukon, for a vacation and it is the only trip they took during the year. Chris left Dawson City on July 26 and returned on August 9 . From their employer, Chris received a taxable travel benefit of $2,000 for their trip, and the total cost of their trip was $1,500.

Since Chris’s taxable travel benefit received from their employer is greater than the $1,200 standard amount, they decide to claim the taxable travel benefit. Even though Chris did not fly for their trip, and they did not leave the territory, they still have to determine the lowest return airfare (LRA). Chris got a quote before they left for their trip. They went online July 19 and got a quote of $1,000 for the lowest return airfare for July 26 (the day their trip began) to the nearest designated city.

• the taxable travel benefit they received from their employer for the trip or the portion of the $1,200 standard amount that Chris allocated to that trip ($2,000)
• the total travel expenses paid for the trip ($1,500)
• the LRA available at the time of the trip, between the airport closest to their residence and the nearest designated city to that airport ($1,000)

The CRA would accept the amount of $1,000 for the LRA, because the quote for the flight was for the lowest return airfare to the nearest designated city. If Chris was selected for review, they would need to send their documents to support their claim for the LRA.

Chris claims $1,000 for this trip, which is the lowest of the three amounts.

Example 4 – Using an economy return airfare

Taylor has lived in Fort McMurray , Alberta, for two years. They decided to go to Edmonton, Alberta, for a vacation in March and it was the only non-medical trip they took in the year. Taylor decided to fly business class instead of economy. Their ticket cost $1,440 and their total expenses for the trip were $2,100. From their employer, Taylor received $1,500 as a taxable travel benefit for their trip. As Taylor did not get a quote for the lowest return airfare (LRA), and the actual cost of the flight they took was not economy class, Taylor claims the airfare table value of $894 for the LRA.

Taylor decides to claim the taxable travel benefit, because the $1,500 they received from their employer is greater than the $1,200 standard amount.

Since Taylor has all the information they need, they can calculate their travel deduction. The maximum that Taylor can claim is the lowest of the following three amounts:

• the taxable travel benefit they received from their employer for the trip or the portion of the $1,200 standard amount that Taylor allocated to that trip ($1,500)
• the total travel expenses paid for the trip ($2,100)
• the LRA available at the time of the trip, between the airport closest to their residence and the nearest designated city to that airport ( Taylor claims the table value for the LRA of $894 , rather than incorrectly claiming the cost of their business class tickets.)

Taylor claims $894 for this trip, because it is the lowest of the three amounts.   

Since Taylor lives in a prescribed intermediate zone, their total travel deduction is one-half ($447) of the total of the lowest amounts for each trip they took ($894) .

Example 5 – How to calculate the travel deduction

Edward, Anna, and their two children are a family of four. They took a two week vacation and drove from Yellowknife to Edmonton in March 2022.

Edward received a $900 taxable travel benefit from his employer, which is an arms-length employer. He calculated his family’s travel expenses using the simplified method:

• Simplified cost to drive round-trip to Edmonton = 2,950 km x 0.675 (cents per km from Northwest Territories) = $1,911.25
• Accommodations cost = $600 (receipts always required)
• Simplified cost of meals for 4 people = $69 (meal rate per day per person) x 4 people x 14 days travelling = $3,864 or $966 per person
• $6,455 total travel expenses split between the eligible family members for Column 4

As Edward did not get a quote on or before the day of travel and he did not fly, he used the LRA amount available in the CRA’s airfare tables on canada.ca/lowest-return-airfare for the trip.

The LRA in the airfare table for a flight from Yellowknife to the nearest designated city, which is Edmonton, in March 2022 is $923 .

Since the LRA is the lowest of the three amounts, Edward will claim a total of $3,692 (the LRA for each person x 4 people traveling).

Screenshot of Chart A on form T2222. For line A, the travelers are identified as Edward, Anna, Child 1, and Child 2. For line B, Edward (name 1) is claiming the standard amount of $1,200 (amount 1) for each of the four travelers. For line C, the total amount in row B is identified as $1,200 for each traveler. 

Screenshot of Chart B on form T2222. Under column 1, the travelers are identified as Edward, Anna, Child 1, and Child 2. Under column 2, the word vacation has been included as the purpose of the trip for each traveler. Under column 3, the standard amount of $1,200 has been included for each traveler. Under column 4, Edward is claiming $2,957, Anna is claiming $1,566, Child 1 is claiming $966, and Child 2 is claiming $966. Under column 5, $923 has been included as the cost of the lowest return airfare for each traveler. Under the Zone A column, $923 has been identified as the lowest amount from column 3, 4 or 5 for each traveler, for a total of $3,692 (box A). Box B is left empty. The total from box A ($3,692) plus the total from box B ($0) is $3,692, which is the final amount of the travel deduction that can be claimed for this trip.

Note: Individual expenses should be put under a specific family member where applicable (for example, the cost of a meal or an airline ticket).

Common expenses cannot be split and should be put under the person who paid the expense (or their spouse or common-law partner). In the example, Edward claimed the mileage expense and Anna claimed the accommodation expense.

Forms and publications

• Income Tax Package
• Form T2222, Northern Residents Deductions

Page details

Ontario announces plan for staycation tax credit and here's how it works

The Ontario government has announced its plan for a staycation tax credit.

Anyone planning a getaway within the province in the 2022 tax year could be eligible under the new " Ontario Staycation Tax Credit " program.

The program was announced as part of the Ford government's Fall Economic Statement , which was tabled on Thursday.

Ontarians would get a 20 per cent personal income tax credit on eligible accommodation between Jan. 1 and Dec. 31, up to a maximum of $1,000 for an individual and $2,000 for a family, for a maximum credit of $200 or $400 respectively. 

Ontario residents could apply for this refundable credit when they file their 2022 personal tax returns and benefit even if they do not owe any tax.

According to the government, an eligible accommodation expense would have to be:

• For a stay of less than a month at an eligible accommodation such as a hotel, motel, resort, lodge, bed-and-breakfast establishment, cottage or campground in Ontario
• For a stay between Jan. 1 and Dec. 31 of 2022
• Incurred for leisure
• Paid by the Ontario tax filer, their spouse or common-law partner, or their eligible child, as set out on a detailed receipt
• Not reimbursed to the tax filer, their spouse or common-law partner, or their eligible child, by any person, including by a friend or an employer
• Subject to Goods and Services Tax (GST)/Harmonized Sales Tax (HST), as set out on a detailed receipt.

The government said this tax credit will help the tourism and hospitality sectors recover and encourage Ontarians to explore the province. 

The credit would provide an estimated $270 million to support over one-and-a-half million families to further discover Ontario, the government said.

Ontario NDP Leader Andrea Horwath said Thursday she believes the staycation credit won't help families and says it should have been a full $1,000 refund on costs spent on a vacation in the province. 

"This thing that is in the update today - about $200 is what it comes out to - that's really not going to help families a great deal," Horwath said. "That's why our $1,000 tax credit idea might be helpful to some families who normally would have taken that vacation right now."

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What is the Ontario Staycation Tax Credit?

If you chose to avoid the headache of long lines, flight delays, or missing suitcases at the airport this year and traveled within Ontario instead–you could get some of your money back at tax time.

Enter the Ontario Staycation Tax Credit—a temporary personal income tax credit to encourage Ontarians to vacation locally.

• The Ontario Staycation Tax Credit is a temporary personal income tax credit that offers up to $400 when you file your 2022 taxes.
• The tax credit applies to eligible leisurely stays in Ontario between January 1 and December 31, 2022 (including Airbnb rentals).
• To be eligible to claim it, you must be a resident of Ontario as of December 31, 2022 and file your tax return.

First, the basics: The Ontario Staycation Tax Credit is a temporary personal income tax credit for eligible Ontario residents.

This year, Ontarians can get up to 20% back on what they paid for short-term stays in Ontario—which could put back as much as $400 in your wallet.

So if you took a local getaway within Ontario in 2022, lean in closer, because this article is for you.

How does the Ontario Staycation Tax Credit work?

The tax credit allows Ontario residents to claim 20% of their eligible accommodation expenses,  up to $1,000 for individuals and up to $2,000 for families . That means getting back up to $200 as an individual and up to $400 back as a family.

You can claim accommodation for a single trip or multiple trips in Ontario. So, if you rented a cottage on one trip and stayed at a hotel on another, both bills could be claimed on your taxes.

So in the new year, when you’re getting organized for tax time, gather your 2022 travel receipts.

How do I qualify for the Ontario Staycation Tax Credit?

Are you an Ontario resident on December 31, 2022? And did you pay to stay somewhere in the province between January 1 to December 31, 2022? If the answer is yes, you likely qualify for the tax credit.

One thing to note: only one individual per family can claim the tax credit in 2022, which can include the expenses of your spouse, common-law partner, and eligible children.

What expenses are eligible for the Ontario Staycation Tax Credit?

Did you rent a cottage in Muskoka this summer or stay at a hotel in Toronto or Ottawa for a concert or weekend getaway? Keep those receipts! You can claim accommodation expenses for holiday stays in Ontario of less than a month, which can include:

• Resorts or lodges
• Bed-and-breakfast operations
• Campgrounds (Ontario Parks, camping resorts, etc.)
• Vacation rental properties (Airbnb, VRBO, Homeaway, etc.)
• The accommodation portion of a tour package expense

However, you can’t just rent Grandpa’s cottage and call it a staycation expense. For it to be legit, it must meet the following criteria:

• The staycation expense must be  yours . The bill must have been paid by you, your spouse or common-law partner, or your eligible child. Whereas if someone—your employer, school, friend, or relative—reimbursed you for the cost, the trip doesn’t qualify for the tax credit.
• Only applies to personal trips . The tax credit doesn’t apply to business travel (sorry!).
• There must be a paper trail . Get a detailed receipt that breaks down the amount paid, the date of stay, the amount of any GST/HST paid, the name of the payor, and the location of the accommodation.
• The host must be registered for GST/HST . Whether it’s a campground or Airbnb, whoever is hosting you must be registered for the Goods and Services Tax (GST)/ Harmonized Sales Tax (HST). It must appear on the detailed receipt.

Example of the Ontario Staycation Tax Credit

Let’s say John and Sarah ran in a Toronto marathon in May and spent $720 to rent a hotel in Toronto for two nights. They rented a cottage for four nights in July, spending $1,080 on their accommodations. And in September, they spent two nights in Ottawa to celebrate their anniversary, spending $500 on hotel accommodations.

Altogether, they spent $2,300 on eligible accommodation expenses in Ontario as a family. John  or  Sarah can claim up to $2,000 of those expenses through the Ontario Staycation Tax Credit and receive $400 back as a family.

How to claim Ontario Staycation Tax credit

At tax time, while you’re gathering your T4 and other tax slips, dig up your detailed travel receipts from stays within Ontario in 2022.

Luckily, TurboTax has your back and makes it easy : just enter those expenses online and we’ll automatically claim the credit on your tax return.

Claiming the credit? We’ve got you!

Who doesn’t want to get (partially) paid to travel? Well, if you took a well-deserved break and explored beautiful Ontario this year, then you’re in for a treat at tax time. Claim the Ontario Staycation Tax Credit for eligible accommodation expenses (hotels, camping, vacation rentals) and get 20% back (up to $200 per individual and $400 per family).

Feel extra good about your staycation this year, too, because you helped bolster the local tourism and hospitality sector that was hit hard during the COVID-19 pandemic. So track down your receipts and keep them handy for when you file your 2022 tax return.

Frequently Asked Questions (FAQ)

Yes, Airbnb stays of less than a month can count, provided the host is registered for GST/HST and the accommodation fits all the eligibility criteria. The same applies to other popular short-term rental sites like VRBO or Homeaway.

The Ontario Staycation Tax Credit is a  refundable personal income tax credit . That means you can receive the tax credit (a.k.a. money back) when you file your return, regardless of whether you owe income tax for 2022. 

The bottom line: claim any eligible expenses for the Ontario Staycation Tax Credit and get money back when you file your taxes.

No! Unlike a tax deduction, it doesn’t reduce anyone’s net taxable income. So gather up your receipts, up to $2,000 worth of eligible expenses as a family, and prepare to save a cool $400—regardless of whom claims it.

Get every credit you deserve

TurboTax automatically searches 400+ credits and deductions for you.

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8 ways canada’s new affordability plan helps make life cheaper for you, 20 popular canadian tax deductions and credits for tax year 2023, turbotax for tax year 2022 is now available.

Payment information and Travel Credits

Am I able to apply a deposit on my vacation instead of paying in full at time of booking?

Yes, United Vacations allows you to hold your vacation with a deposit from as little as $250 down and pay later. The actual deposit amount required varies based on the destination and hotel accommodations selected.

How can I put as little as $250 down and pay later?

Plan your vacation as usual, including any excursions, show tickets, tours, rental cars, and other components you'd like. If you're booking more than 6 weeks in advance of your travel date, the option to put down a deposit as little as $250 down will appear on Checkout Step 3 in the Final Payment section:

The amount to be scheduled will appear. Select a payment date more than 45 days before your departure date, and your credit card will automatically be charged on that date. If you've entered multiple credit cards for your initial deposit, select the corresponding number in the Payment # field – a "1" in this box will charge the first credit card listed, "2" will charge the second credit card listed, and so on.

If you'd like to make several payments over time, or charge the final payment on multiple credit cards, you can set up an email reminder. You must select a date that is more than 47 days prior to departure. This automated email will remind you to log in to the account you created during the booking process to enter credit card information and complete payment on your vacation. You may log into your account and apply multiple payments over time, or pay using multiple credit cards. Important: All payments must be completed no less than 45 days before departure.

Does my vacation qualify for the option to put down as little as $250 and pay later?

If you're planning your vacation more than 6 weeks before travel, and your vacation cost meets the deposit requirements, you will qualify for the vacation payment plan. You will see deposit information on Checkout Step 3 of the reservation process if your vacation package meets the deposit requirements.

What if I don't want to use the deposit option?

You may pay for your vacation in full at time of booking. Simply change the Payment Amount in Checkout Step 3 to the total package price, and your full payment will be processed when you complete your booking.

How are deposits calculated?

Deposits include a portion of both your air and hotel costs, plus the full cost of any show tickets, Vacation Protection, or other features you may select.

I'm booking six weeks or more in advance why don't I see the deposit option?

If you do not see the deposit option, it generally means you're getting a great deal on your vacation! Sometimes the minimum deposit rules will cover your full air and hotel costs. This will most likely happen in situations like these:

• You've selected a midweek stay when hotel rates can be lower than weekend rates
• You've selected a hotel or flight that is on sale, so the total price is lower than the minimum deposit

In addition, some special holiday or convention periods require full payment at time of booking.

What is Uplift*?

Uplift makes travel more accessible, affordable, and rewarding. With flexible payment options, you can finance your trip and pay over time. Simply select Pay Monthly at checkout, complete a short application, and if approved, learn about your monthly payment options.  Visit Uplift's Frequently Asked Questions page to learn more .

*Down payment may be required. Actual terms are based on your credit score and other factors and may vary. APRs range from 0% to 36%. Minimum $150 purchase required. Not everyone is eligible. Loans made through Uplift are offered by these lending partners:  uplift.com/lenders .  Privacy Policy .  Terms of Use .  

Will Change or Cancellation Penalties still apply if I use the deposit option?

Yes. You will still be subject to all change or cancellation penalties outlined in the Terms and Conditions, as well as any supplier penalties should you wish to change or cancel your vacation.

What if I want to pay for some or all of my vacation before the Automatic Final Payment date?

You are welcome to pay for some or your entire final amount due before the Automatic Final Payment date. You can do this either by logging in to the account you created at time of booking or by calling us at 1-888-854-3899.

We will subtract these payments from your total amount due. If any balance remains after your interim payments, only the balance amount will be charged to your credit card—we will never overcharge you.

Are payments processed on a secure server? How do I know?

Yes, all United Vacations payments process through a secure server. You know the server is secure by the little closed lock that appears at the bottom right of the Internet Explorer window. You can also see the "secure" URL displayed briefly on the bottom left of the screen immediately after you click Complete Booking.

What taxes and fees do I have to pay?

Taxes and fees can include airport facility charges, federal taxes, state taxes, and government fees. The complete vacation package determines the fees and surcharges. The website includes these fees in all vacation prices that appear on the selection screens. When you search using the vacation search tool, the prices you see available include the air and hotel taxes and fees when you book online.  Information on taxes and fees . In some foreign destinations, there may also be additional nominal fees not included in the vacation package price. These fees are due upon arrival and must be paid at the airport before departure. For a listing of these fees, see  United Vacations Terms and Conditions .

What is the Federal Excise Tax?

The Federal Excise Tax is a government-imposed tax on each flight segment of your itinerary. A flight segment is defined as a takeoff and landing.

What is the airport Passenger Facility Charge (PFC)?

The Passenger Facility Charge (PFC) is a fee collected by airports from airlines for each departing or connecting passenger.

What is the September 11th Security Fee?

The Transportation Security Administration (TSA) has mandated that all U.S. airlines add a security fee to all tickets. This government-imposed fee, called the "September 11th Security Fee," will be used to pay the government's cost for providing federal civil aviation services. This includes training, salaries, and benefits for the federal security screeners and law enforcement personnel, as well as the Federal Air Marshal program.

Can I use more than one credit card to apply payment?

Yes. You can use up to four different credit cards for payment at the time of booking.

What happens when the website rejects a credit card?

The website rejects a credit card if the information is entered incorrectly, the credit card is invalid, or the credit card balance exceeds its limit. If one of these situations occurs, you immediately receive an error message. Contact the United Vacations customer care center (1-888-854-3899) or your preferred travel professional for assistance.

How do I pay with my Travel Credit?

At checkout, select ‘Travel Credit’ as the payment method. Then enter your original reservation number to apply your Travel Credits to your new reservation.

How can I look up my Travel Credit amount?

Check travel credit balance here.

What are the travel credit details, restrictions, and new booking policies?

Travel Credits*:

• are valid for travel within 395 days from original departure date.
• are nonrefundable, nontransferable, not redeemable for cash, and must be used for travel commencing by expiration date.
• will be issued in the names of each adult(18+) passenger on the original reservation.

*Travel Credits are provided for all air-inclusive bookings without Travel Protection, as well as on all bookings in which the Travel Protection Plus Travel Credit option has been selected. 

If I receive a Travel Credit, can I rebook and add Travel Protection on the next booking?

• Yes, there are no restrictions on the new booking. However, if you purchased the Travel Protection Cash Refund option on the new booking and subsequently cancel, the portion paid with a travel credit will be refunded as a travel credit.

How many Travel Credits can be used on a new reservation?

You can use Travel Credits from up to 2 reservations in one transaction.

If I use my Travel Credit on a new reservation and have to then cancel the new reservation, what happens to my Travel Credit?

Your Travel Credit will now reside on the new canceled reservation.

What if I have airline credits to use?

If you want to take advantage of any airline credits listed above, you will need to call our Contact Center to book your trip.

Can I give my Travel Credits to someone else to use?

Travel Credits are non-transferable.

What is the expiration date for Travel Credits?

Travel must be completed by the Travel Credit expiration date provided at issuance. Any unused funds will expire on this date. Any airline credits are subject to the carrier’s rules.

If my Travel Credit doesn’t cover the full cost of my new trip, how do I pay the balance?

First, add your Travel Credit as your first form of payment, then select additional cards to pay remaining balance.

If my Travel Credit has a remaining balance after I purchase a new vacation, can I redeem the balance for a future trip?

Yes, the same Travel Credit rules and expiration dates apply, but you can use the remaining travel credit funds on a future trip.

Can I use my Travel Credits along with the Uplift payment option?

Can we apply the Travel Credits for bookings already made months ago?

Yes, once you receive your Travel Credits issuance email with the details about your credit.

What is the timeframe for using leftover funds?

Any remaining funds must be used by the original expiration date of the Travel Credits when they were issued.

If two pax were on the original cancelled booking, but only one is ready to rebook. Can that one person use their travel credit and the 2nd pax save theirs for a later trip?

Those credits are issued per reservation. With Travel Credits issued per passenger, yes.

Where do any remaining Travel Credits amount live? How do I access them?

All Travel credits live on the original reservation until transferred or they expire. You can access them by creating a new booking and applying the Travel Credits.

Does the travel credit letter also show the cancellation fees or fees from the airline so we can determine what was lost if anything when the booking was cancelled?

No, but the Travel Credit will only reflect funds that can be used. All penalties are assessed before the credits are issued.

Does the new functionality work on multi-stop reservations?

Yes, it can be used on any reservation.

Can I use my MileagePlus® reward miles with a United Vacations air and hotel package?

At this time we are unable to redeem MileagePlus reward miles toward a United Vacations package.

How do I know my reservation is confirmed?

Your reservation is confirmed if a confirmation number appears at the top of the Reservation Confirmation screen, after you click Complete Booking. It may take several minutes for the Reservation Confirmation screen to appear. Remember to press Complete Booking only one time, and do not stop the transaction prior to receiving your confirmation number. If you stop the transaction or click the back button and then click Complete Booking again, you may confirm the reservation more than once and incur double charges on your credit card. After you confirm the reservation, you will automatically receive an email confirmation.

When I try to confirm my online booking, at the end of the reservations process it says that my address cannot be verified. Why?

Our system can recognize your address only if you enter it EXACTLY as it appears on your credit card billing statement. Please refer to your credit card billing statement and try entering your address again. If you continue to receive the "cannot verify address" message,  email United Vacations . On the form, select "Problems verifying credit card address for payment" from the Subject drop-down menu. United Vacations will contact you with further instructions.

I did not receive an email copy of my reservation confirmation. Why?

Occasionally, email confirmations do not successfully reach their recipients. Examples of when this may happen include:

• The email address was entered incorrectly.
• Your email provider blocked the email with a spam filter. Make sure you add us to your address book. (Please note, you can check the setting in your email spam filter and ask your email provider to stop blocking your emails.)
• Your email box was full.

What is Save Your Itinerary?

This feature allows you to save vacation itineraries that you may want to view or purchase later.

PLEASE NOTE: This feature does not guarantee the price. The price is guaranteed only when you complete Checkout and get a Reservation number.

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Want to Make Your Vacation Tax Deductible? Here’s How

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After more than a year of being cooped up, Americans are getting antsy and wanderlust is back again, evidenced by packed airports across the country recently. If you’re a small business owner or self-employed , this welcomed development could come with additional perks, such as making your vacation tax deductible.

But there are some specific steps taxpayers need to take to make some write-offs available.

First, to legally deduct your vacation, the primary purpose of the trip must be business. While many people have enjoyed remote work over the last year, bringing your computer on a family vacation doesn’t meet the standards for the IRS, Tom Wheelwright, CPA and author of Tax-Free Wealth, tells GOBankingRates.

“You must have a business reason for taking the trip and you must be traveling to a location outside of where you do your day-to-day business,” he says.

Many aspects of a trip are tax deductible, including 100% of transportation by plane, train, bus, rental car and more. Additionally, you can write off 100% of lodging on the days that you work.

“This means that if you’ve done work on Thursday and Friday, but enjoyed family time on Saturday and Sunday, only two days of lodging are deductible. Thanks to current coronavirus relief, you can also deduct 100% of business meals through 2022 as long as the expenses aren’t lavish or extravagant under the circumstances,” Wheelwright says.

Indeed, in April 2020 the Treasury Department and the Internal Revenue Service provided guidance under the Taxpayer Certainty and Disaster Relief Act of 2020. “The Act added a temporary exception to the 50% limit on the amount that businesses may deduct for food or beverages. The temporary exception allows a 100% deduction for food or beverages from restaurants,” according to the IRS.

“Beginning January 1, 2021, through December 31, 2022, businesses can claim 100% of their food or beverage expenses paid to restaurants as long as the business owner (or an employee of the business) is present when food or beverages are provided and the expense is not lavish or extravagant under the circumstances,” the notice further explains.

Wheelwright also recommends that to write things off, you will need proper documentation. “So be sure to keep track of your receipts and make sure they have the date, amount, the business relationship or activity noted.”

He adds that unfortunately, friends and family can’t take advantage of the same deductions while on a trip together unless they’re also business owners on a business trip.

“However, they can enjoy the use of shared spaces like the rental car or a hotel room,” he says.

There are additional items that can be deducted such as laundry and dry cleaners, according to the IRS. Any tips you leave can be added as well.

Keep in mind that the IRS is extremely specific (and perhaps a bit confusing) as to the terminology it uses, for example when defining travel expenses:

“For tax purposes, travel expenses are the ordinary and necessary expenses of traveling away from home for your business, profession or job. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your business. An expense doesn’t have to be required to be considered necessary ,” it explains.

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Maximizing Tax Savings: How to Write Off Deduct Your Family Vacation Travel Expenses as a Business Trip Expenses

10 Minute Read

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Antonio Del Cueto, CPA

April 8, 2024

Imagine you're a clever detective on a mission, where every clue you find is a piece of the puzzle to make your vacation a secret mission for work. As a business owner, you know that turning a trip into a business adventure can be like finding hidden treasure, turning your travel day and lodging into a tax deduction.

To do this, you plan each business day with care, filling it with business activities that are both ordinary and necessary to conduct business. It's like setting up a perfect disguise for your vacation, making sure every activity is business-related, so if an audit comes knocking, you're ready with your detective notebook filled with evidence. This secret mission requires smart planning to ensure your getaway can rightfully earn its place as a business-related trip.

Want an easier way to file your taxes? Download our FREE tax guide for individual filers.

Understanding Travel Expenses for Business Deductions

Let's learn about when you can use travel costs to lower your taxes. This is for when the travel helps your business. We will look at what costs are okay, how to know if a cost is for business or just for fun, and what proof you need to show it's for business.

What qualifies as a deductible business expense?

A cost is okay to lower your taxes if it's normal and needed for your work. Travel costs are okay if they help your business. This could be going to meetings or learning things important for your job. If your trip is mostly for work but you also have fun, you can still write off the work parts.

How to differentiate between personal and business expenses?

Knowing the difference between fun costs and work costs means you only use the work costs to lower your taxes. If your trip has both fun and work, only count the work parts. Use business cards for work costs to make this easy.

What documentation is required for business travel deductions?

You need to keep track of all your business travel costs. Keep all receipts, tickets, and other proofs. Also, write down why each trip was needed for work. This is important if the IRS asks about your tax deductions.

Maximizing Tax Savings on Business Travel

Now, let's talk about how to figure out which travel costs can lower your taxes the most. We will go over how to add up these costs and the rules to follow. This includes how to handle food costs on trips.

How to calculate deductible travel expenses?

To find out what you can deduct, add up all your business trip costs. This includes things like flights, hotels, and car rentals. Only include costs that were normal and needed for your work.

What are the IRS guidelines on deducting business travel expenses?

The IRS says your travel costs must be both normal and needed for your job. The trip should mainly be for work. You should also be away from your main work area for more than a day's work.

How to deduct food expenses during business trips?

You can use half of your food costs during trips to lower your taxes. Keep your meal receipts or use a set amount the IRS says is okay. Remember, very expensive meals might not count as much.

Further Reading: How To Create Expense Reports

Tips for deducting expenses for family on a business trip.

Ready to take note these tips for deducting travel expenses for your family business trip!

Can you deduct expenses for family on a business trip?

When traveling for work on a business-related trip around the country, you can deduct travel expenses for yourself, but not for your family. However, if your family members must spend time doing business at the place of business with you, their expenses may qualify as business related. To qualify for a tax home for longer period, such as five days meeting with clients, every expense you incur can be deduct 100. Make sure to only deduct transportation and accommodation expenses for the time doing business.

When filing your taxes, it's important to learn how to write off only expenses that are deemed “ordinary and necessary” for your business. If the trip is longer than a normal domestic travel and involves more paid and what you actually spent, you can deduct those expenses. However, expenses for family members who aren't directly involved in the business activities can’t write be deducted as a deduction you don’t qualify for.

What are the limitations for deducting family travel expenses?

Limitations for deducting family travel expenses on your tax return can be tricky. In order to deduct travel expenses, the trip must be entirely for business purposes. If you mix business and personal activities, you can only deduct 50 percent of your business-related expenses. You must also spend the majority of the days on your trip doing business activities in order for the entire trip to qualify as a business trip.

For a trip to qualify as business-related, you must leave your tax home and travel to a business destination where you will conduct business meetings or other activities related to business. If you extend your trip for vacation days or include entertainment expenses, those expenses may not be tax deductible . Be sure to track business miles and keep records of actual expenses in order to still deduct expenses related to business.

How to document family-related costs for business trips?

When documenting family-related costs for business trips, it is important to distinguish between expenses that are tax-deductible and those that are not. Small business owners who incur travel costs while traveling for business may be able to deduct their transportation expenses, such as their plane ticket and other travel-related costs. However, it is crucial to ensure that the primary purpose of the trip is business-related. If the majority of your trip is considered business days, you may still write off the expenses incurred during those days.

Before attempting to deduct travel expenses from your taxes, it is advisable to consult with a CPA to ensure that your expenses qualify as business-related. The IRS requires that the purpose of the trip be primarily for business in order to deduct the cost of the trip from your taxes. If you are traveling for business and have a few days meeting with clients, you may be eligible to deduct 50% of your expenses incurred during those days as tax write-offs.

Further Reading: What You Should Know About Small Business Accounting, Tax, And Bookkeeping Services

Key takeaways:.

• Business Purpose : The trip needs to be mainly for business, like going to a conference or meeting clients.
• Documentation : Keeping track of things like receipts and schedules to show the trip is for business.
• IRS Rules : Rules made by the tax people to decide if your trip can be counted as a business expense.
• Deductible Expenses : Costs that you can subtract from your income before paying taxes, like travel or hotel.
• Mixing Business with Pleasure : Sometimes you can do fun things on your trip, but the main reason for the trip must be for business.

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Here's who could be responsible for paying for the Baltimore bridge disaster

• The Francis Scott Key Bridge in Baltimore collapsed after a container ship collided with it.
• Several entities could be on the hook to foot the bill in the aftermath of the disaster.
• The maritime insurance industry will likely be saddled with the highest costs. 

The Francis Scott Key Bridge in Baltimore collapsed on Tuesday after a large container ship ran into it, leading to six presumed deaths and millions of dollars in possible damage.

It's still too early to estimate the total economic impact of the disaster, but between the cost of rebuilding the decades-old bridge, compensating the victims' families , and paying out damages for disruptions to the supply chain, the eventual cost of the disaster is expected to be significant.

Who will pay to rebuild the bridge?

President Joe Biden said on Tuesday the federal government should be responsible for paying to reconstruct the damaged Francis Scott Key Bridge.

"It is my intention that the federal government will pay for the entire cost of reconstructing that bridge, and I expect Congress to support my effort," Biden said.

The bridge was built in the 1970s for about $60 million, but the cost of rebuilding it could be 10 times its original price tag, an engineering expert told Sky News. 

Baltimore is among the busiest ports in the nation , with more than a million shipping containers passing through each year. The collapse — which closed the port to all maritime and most road traffic until further notice — is already beginning to wreak havoc on the supply chain.

The cost of building the bridge back fast enough to offset diversions as much as possible could saddle the government with a more than $600 million bill, David MacKenzie, the chair of the engineering and architecture consultancy COWIfonden, told Sky News.

Who will pay for damages to the ship and its cargo?

The container ship, the Dali , is owned by a Singapore-based firm. The ship's charterer, Maersk, confirmed to Business Insider that vessel company Synergy Group operates the ship. 

However, the companies with cargo aboard the Dali could ultimately be responsible for some of the ship's damages and cargo costs, according to Ryan Petersen , the CEO of the supply-chain-logistics company Flexport, which had two containers on the ship.

Related stories

The Dali was carrying 330 containers that must now be rerouted, Petersen said in an X thread.

An ancient maritime law known as " general average " dictates that companies with even a single container aboard a ship split certain damages pro rata based on the number of containers they had on board, ensuring all the stakeholders benefiting from the voyage are splitting the risk, Petersen said.

General average situations can occur when a ship is stranded or when cargo is damaged or thrown overboard to save the vessel, according to Flexport . The concept helps ensure that all parties who have a vested interest in the vessel share the cost and concern of protecting it.

It's too soon to know whether damages incurred to free the Dali in the coming days will qualify as a case of general average.

Who will pay for everything else?

The majority of the financial fallout is likely to lay primarily with the insurance industry, according to media reports.

Industry experts told the Financial Times that insurers could pay out losses for bridge damage, port disruption, and any loss of life.

The collapse could drive "one of the largest claims ever to hit the marine (re)insurance market," John Miklus, the president of the American Institute of Marine Underwriters, told Insurance Business.

He told the outlet that the loss of revenue from tolls while the bridge is being rebuilt will be expensive, as will any liability claims from deaths or injuries.

The Dali is covered by the Britannia Steam Ship Insurance Association Ltd., known as Britannia P&I Club, according to S&P Global Market Intelligence.

In a statement to Business Insider, Britannia said it was "working closely with the ship manager and relevant authorities to establish the facts and to help ensure that this situation is dealt with quickly and professionally."

Britannia is one of 12 mutual insurers included in the International Group of P&I Clubs, which maintains more than $3 billion of reinsurance cover, sources familiar with the matter told Insurance Business.

Britannia itself is liable for the first $10 million in damages, both FT and Insurance Business reported. Whatever remains is dealt with by the wider mutual insurance group and Lloyd's of London, a reinsurance market in the UK, the FT reported.

Update: March 28, 2024 — This story has been updated to include additional information about general average and clarify that it is too soon to know whether general average will apply in the case of the Dali.

Watch: The container ship that destroyed the Francis Scott Key Bridge has crashed before

• Main content

St. Petersburg, FL   Travel Guide

Courtesy of Debbie Friley Photography | Getty Images

17 Best Things To Do in St. Petersburg, FL

St. Petersburg, or "The Sunshine City," is a great place to fill up on cultural and outdoorsy attractions, ranging from the renowned Dalí Museum to Fort De Soto Park to The Mahaffey Theater. The city is infused with Spanish-American history, and full

• All Things To Do

Fort De Soto Park Fort De Soto Park free

Spanning five small islands, the 1,136-acre Fort De Soto Park lies at the mouth of Tampa Bay and attracts more than 2.7 million visitors a year. The park features 7 miles of waterfront, two fishing piers, multiple hiking and biking trails, picnic and camping grounds and a historic fort. Climb the stairs of the fort for a breathtaking view of the Sunshine Skyway Bridge, one of the world's longest cable-stayed concrete bridges. Then, stop by the Quartermaster Museum to learn more about the fort through historic photographs and Spanish-American War artifacts.

The park is also one of the best places in St. Petersburg to visit the beach. The popular North Beach is recognizable by the large pirate ship playground near its entrance and the myriad of seashells and white sand dollars along its sands. At the waterfront, travelers can also rent a canoe or kayak and navigate the 2-mile paddling trail or try fishing. Recent visitors raved about everything there is to enjoy at the park, especially the lengthy dog beach .

St. Pete Beach St. Pete Beach free

U.S. News Insider Tip: Beach parking is consistently monitored and parking time limits are strictly enforced. Leaving your car parked even a few minutes past your allotted time may result in a ticket. – Jacqueline Drayer, Contributor, Travel

St. Pete Beach is a barrier island community just west of St. Petersburg and home to a large swath of award-winning beaches. Pass-a-Grille Beach is a long undeveloped stretch of public beach, perfect for a variety of water sports, including parasailing, stand-up paddleboarding, windsurfing and kiteboarding. Recent visitors raved about St. Pete Beach, noting the soft, white sand, terrific maintenance and warm Gulf of Mexico waters. However, some note a difficult parking situation.  

Dalí Museum Dalí Museum

The waterfront Dalí Museum holds the largest collection of Salvador Dalí's works outside of Europe. The building is just as impressive as the masterpieces displayed inside. One of the architectural elements is called the "Glass Enigma" — it's composed of 1,062 glass triangles that are visible from the outside. On the inside, a free-standing spiral staircase dominates the entrance. Architect Yann Weymouth combined these surreal-inspired elements with some realistic touches: the walls are designed to be hurricane proof. The museum also features a labyrinth, gardens and the purported Fountain of Youth.

In the collection, visitors can admire the breadth of Dali's Surrealist works, in media spanning everything from watercolors to sculptures. Highlights include "The Disintegration of the Persistence of Memory" and "The Hallucinogenic Toreador." Recent travelers found the building as artistic and strange as Dalí himself, adding that it made the experience enjoyable for both children and those not particularly interested in art.

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Sunken Gardens Sunken Gardens

This 6-acre attraction in downtown St. Petersburg features thousands of tropical plant species, as well as a variety of exotic birds and waterfalls. Paved pathways make it easy to explore the botanical garden. Enter the 100-year-old roadside gem and follow the trail to the orchids and the Growing Stone, a fossilized limestone rock. Other highlights further along the trail include the Japanese garden, canopy of live oaks, and a flock of flamingos.

Visitors raved about the beauty of the garden, but caution to bring bug spray. They particularly enjoyed viewing the birds and note there is information available that details the history of the garden.

St. Pete Pier St. Pete Pier free

Piers have dotted the St. Pete waterfront since the 19th century – sometimes more than one at a time! The latest pier opened in 2020, on the site previously occupied by a distinctive inverted pyramid design. The new pier is expansive – its 26 acres include a parklike setting (think: playgrounds and green space), restaurants, shopping, a splash pad, the beach and public art.

Recent visitors enjoyed the variety of entertainment options on the pier. Many noted that it felt like a true public space, despite the significant amount of restaurants and shopping opportunities on-site. Some locals expressed regret that the old pier was torn down, while others applauded it.

Saturday Morning Market Saturday Morning Market free

The market is held every week in downtown St. Petersburg and is the perfect place to buy fresh produce and a gift or two. Choose from different types of ready-to-eat food representing more than 15 nations, whether it's Mexican tamales or European sausage. Live music plays in the center and performers like balloon artists and magicians are scattered throughout. Recent visitors found the market the best place to be on a Saturday, and many especially enjoyed the social experience.

Located in the Al Lang Stadium parking lot, the market is open from early October to late May every Saturday from 9 a.m. to 2 p.m. A smaller summer market runs from June to August in Williams Park every Saturday 9 a.m. to 1 p.m. It's free to explore, but you'll want to have some cash in case any goodies pique your interest. Plenty of parking is available near the market: the South Core Garage across the street has more than 1,100 spaces with a $3 entry fee and the Sundial Parking Garage two blocks north has more than 1,300 spaces and costs $1 for the first four hours. For more information on vendors and parking, visit the market's official website .

Pass-a-Grille Beach Pass-a-Grille Beach free

Located at the end of St. Pete Beach , Pass-a-Grille distinguishes itself from the many area beaches by offering 4 miles of undeveloped beach paradise. Unlike many of the northern barrier islands that make up St. Pete Beach, there are no buildings directly on the beach, except for the Paradise Grille. There is beautiful sand, relatively shallow water, and facilities are well-maintained.

Recent visitors had a wonderful time at Pass-a-Grille. They praise everything from the sunsets to the sea shells, as well as the nearby shops and restaurants off the beach. Couples especially appreciate the quiet and romantic setting. Travelers recommend arriving early to secure a parking space.

Tropicana Field Tropicana Field

Located near downtown (and less than a mile from the Chihuly Collection ), Tropicana Field is the only professional sports facility that features a tank full of cownose stingrays. Thanks to a partnership with the Florida Aquarium, visitors can touch, feed and interact with stingrays throughout a game. For many, however, the draw of the field is attending a Tampa Bay Rays baseball game. The dome-covered stadium is the only MLB park that has an artificial surface with all-dirt base paths.

Recent visitors found the air-conditioned stadium to be a nice break from the stifling Florida heat and humidity. When the weather is too hot for the beach, a Rays baseball game is a good alternative. Offseason, other performances also take place at the stadium. Ticket prices for baseball games vary depending on the time of year, the opponent and the seat location. For more information on upcoming games, visit Tropicana Field's official website .

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Morean Arts Center Morean Arts Center free

The Morean Arts Center is a collection of four venues: a general arts center, glass studio, clay studio and the Chihuly Collection . The Morean Arts Center boasts a free art gallery as well as art classes, while the glass and clay studios are used by working artists. Visitors can purchase pieces at the studios and watch glassmakers or clay artists at work. The Chihuly Collection features artwork by renowned glass artist Dale Chihuly.

Recent visitors were impressed by the eclectic and forward-thinking art on display. Many travelers recommended stopping by the glass-blowing demonstration. Whether visitors purchased art or just enjoyed the galleries, they considered this destination worth their time.

Weedon Island Preserve Weedon Island Preserve free

The Weedon Island Preserve spans 3,190 acres and comprises aquatic and upland ecosystems. Visitors can take a variety of guided hikes, walk the boardwalks through tidal flats and mangrove forests and fish on the pier. Located deep within the preserve, the Cultural and Natural History Center features an exhibit gallery called "Connecting People and Place" that encourages modern visitors to reconnect with the environment – and learn about the area's earliest Native Americans, whose descendants collaborated on the design of the center – through 6,000 square feet of interactive exhibits. The center also offers interpretive hikes, workshops and other programs. The hours are Thursday through Saturday 9 a.m. to 4 p.m. and Sunday 11 a.m. to 4 p.m.

Recent travelers raved about kayaking the mangroves and bird-watching on the boardwalk. Fishing and picnicking are also popular activities at the preserve. The fishing pier and outlying oyster bars are ideal for catching sea trout, snook and sheepshead. Four picnic areas and pavilion are available on a first-come, first-served basis.

Chihuly Collection Chihuly Collection

U.S. News Insider Tip: This gallery is located in St. Pete's robust craft brewery scene. There are four popular breweries located within three blocks of the collection. – Jacqueline Drayer, Contributor, Travel

Located downtown, this permanent collection of world-renowned artist Dale Chihuly is displayed in the first building specifically designed to hold the his works. The entrance is dominated by the iconic 20-foot sculpture of cerise-colored rocks and the inside is brimming with intricate glass works. Large scale installations abound and highlights include "Persians," "Tumbleweeds" and "Macchia."

Shell Key Preserve Shell Key Preserve free

Those looking to escape development entirely will enjoy Shell Key Preserve. More than 1,800 protected acres – which include their own barrier island – is a place for humans to connect with the beauty of nature. Nesting, wintering, and migrating birds are important parts of this ecosystem, which means the area is prime for bird-watching. Trails are also on-site, should you desire a walk. There are no facilities or developments of any kind and access is only via boat. Private vessels can pull up to the island, or visitors can take the public Shell Key Shuttle.

Recent visitors called this excursion a highlight of their vacation. The waters here are shallow and clear, and some took advantage of the chance to snorkel. Some noted that the shuttle does not always make all scheduled trips – calling ahead is wise. Offseason, trips may be cancelled day-of due to weather or low attendance.

Vinoy Park Vinoy Park free

Vinoy Park is one of the most visited parks in St. Pete. Its location on the downtown waterfront offers scenic city views. The park is well-known as a festival, concert and sporting event space. On quieter days, walkers, runners, and cyclists fill its trails.

Recent visitors raved about the walking paths and opportunities for a leisurely rest in the park. Out-of-state travelers especially enjoyed the abundant palm trees. Some note that it is easy to combine a walk through the park with a museum or shopping visit nearby. The St. Pete Pier is also in walking distance.

Dolphin Watching Nature Cruise and Eco Tour from Hubbard's Marina in John's Pass

(219 reviews)

from $ 34.95

Tiki Boat cruise to John's Pass, Madeira Beach. St Pete Beach

(35 reviews)

from $ 69.00

Parasail Flight at Madeira Beach

(247 reviews)

from $ 109.00

Florida Holocaust Museum Florida Holocaust Museum

The Florida Holocaust Museum was founded in 1992 by a Jewish businessman and philanthropist who escaped Nazi Germany in 1939. After serving in the U.S. Army during World War II, he collaborated with Florida business and community leaders to create a living memorial to the millions of people who died in the Holocaust. The result is one of the largest Holocaust museums in the country.

It is dedicated to "teaching the members of all races and cultures the inherent worth and dignity of human life in order to prevent future genocides." To achieve this goal, the museum has several permanent and special exhibits. These include a railroad boxcar (the same type Nazis used to send Jews to death camps like Auschwitz and Treblinka); multimedia interactive exhibits where visitors can ask survivors questions; and a core exhibit that presents the history of the Holocaust and antisemitism through artifacts, photos, and videos. There are also frequent evening events.

Museum of Fine Arts Museum of Fine Arts

Discover nearly 5,000 years of civilization in the Museum of Fine Arts, located in the heart of downtown. Highlights include masterpieces from Monet, O’Keefe, and Renoir, a sculpture garden and a noted photography collection. The traveling exhibits and events, which include frequent musical performances and lectures, make multiple visits to the museum worthwhile.

Travelers describe the museum as an excellent survey of art history and recommend visiting on Thursday nights when admission is reduced. Many especially enjoyed the on-site cafe and live music.

Duke Center for the Arts – The Mahaffey Theater Duke Center for the Arts – The Mahaffey Theater

Located in the heart of downtown St. Petersburg, Duke Center for the Arts – The Mahaffey Theater is a cultural jewel that seats up to 2,031 visitors. Top-quality national and international artists, such as the renowned Florida Orchestra, grace the theater's stage. The chock-full calendar includes everything from performances of Rachmaninoff's piano concertos to Zach Williams to stand-up comedy shows. Recent concertgoers raved about the seats at the theater, finding them all, including the least expensive ones, to be fantastic in terms of views and acoustics.

The Mahaffey offers on-site cash-only parking for $10 and multiple cocktail bars onsite. Patrons should plan to arrive at least 45 minutes before showtime. Tickets vary in price depending on the event and seat. For more information on upcoming shows, visit the official website .

Boyd Hill Nature Preserve Boyd Hill Nature Preserve

For those intrigued by Florida's preserves, but wanting to stay on land, look no further than Boyd Hill Nature Preserve. Located in St. Pete itself, this 245-acre site was once a zoo and botanical garden. Reclaimed by nature, the preserve features a Main Trail, from which multiple side trails – ranging in length from just 0.15 miles to nearly 1.5 miles – allow visitors to explore different habitats.

Recent visitors highly recommend a stop here. The area is peaceful, and despite its compact size houses a variety of flora and fauna. A lucky few visitors spotted alligators, tortoises, and crabs in the water. On a hot day, be sure to wear sunscreen, a hat, and carry water.

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