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What Meals Are Tax Deductible For Business?

2016-02-10

Minyang Jiang

If you have a business and you eat, you’re probably eligible for business tax deductions, at least some of the time. Here are four ways your meals — and your coffee — might be tax deductible.

#1: You Put Together An Event That Includes A Meal

Let’s say you organize a day-long seminar. As part of the tuition, you furnish lunch. In that case, 100% of the cost of the meal is deductible.

#2: The Meal Is Part Of A Sporting (Or Other Type Of Entertainment) Event

If you do business before and/or after the event, the cost of the event is deductible. The food expense is deductible as well.

#3: You Take Out A Business Associate, Vendor, Employee, Client, Prospect, Or Other Person Associated With Your Business

This is the most common meal deduction taken, although it’s only 50%. If you spend $100 taking a prospect out to lunch, you’ll only be able to take a deduction for 50% of the cost. As with all of the other deductions, you’ll need to be able to prove the business purpose, and that you actually paid for the expense with a receipt of some kind.

#4: You Have A Meal For Benefit Of The Business At The Business’s Location

The wording is awkward, but that’s how the IRS describes the best way to write off 100% of your meal expenses. If you have a meal at your place of business (and that could be your home office) and it’s for the benefit of the business, such as with a meeting or while you’re working at your computer, the cost is 100% deductible.

Pick up a latte and bagel and check your email. It’ll be 100% deductible! Hire a personal chef to come into your home office three days a week to make gourmet, healthy meals for your lunch meetings with your assistant, and it’s 100% deductible.

Of course, you need to have a business to get the deduction and you need to have good records that prove the meal had a business purpose and that you actually paid for the expense.

For more tax deduction tips, visit USTaxAid.com