Broker Check
Tax Tips

Tax Tips

December 11, 2020
We get a lot of questions about deductible meals/entertainment:
50% Deductible (to business owner) meals:
  • Ordinary and Necessary for business
  • Not lavish or extravagant
  • Taxpayer or employee present at meal
  • Provided to customer, consultant or contact
  • Separately stated if part of entertainment (dinner was $x, show was $y)
NON-DEDUCTIBLE entertainment:
  • Concerts, shows, theater
  • Hunting, fishing, golf, sporting events
  • Country clubs, bars, athletic clubs, social clubs
  • BUT Deductible if part of taxpayer's business (golf for an equipment vendor, concert for a singer, etc.)
100% deductible (to business owner) items:
  • Occasional employee benefit expenses (picnic, party, etc.)
  • Cost of goods sold
  • Made available to general public (snacks, water, etc.) as de minimis
  • Advertising expenses (open house, similar events/items)