Deduction for Meals
03/01/2015
In general, businesses are limited to deducting 50% of meals for tax purposes. However, did you know that there are some exceptions to this rule? Most notably, if your business is in the Restaurant industry or the Transportation industry, there are some exceptions to the 50% deduction limitation.
Another exception to the 50% deduction limitation, which applies to most industries, is the de minimis benefit. The de minimis fringe benefit includes the occasional coffee, donuts or soft drinks an employer provides on the premises, which may qualify to be 100% deductible to the business. You may also deduct 100% of meals furnished to your employees, provided the meal meets certain criteria, such as the meal is furnished on the business premises, the meal is furnished for the convenience of the employer (for example you have asked your employees to work overtime or on a Saturday) and more than half of the employees (non-owners) are provided the meal.
If you have any questions, or need assistance, contact Christina Gibford, CPA
In addition, the Internal Revenue Service has several resources for businesses to stay compliant. You can review Publication 15-B or Publication 434 for more information.
Updated 1/01/2018 - 100% meals deduction for the Internal Revenue Service expired 12/31/2017