So In Business You Think You Can Have Great Meals and Deduct it?

Michael Lodge

by Michael Lodge

When Clients come into the office with their business returns they spend a lot on meals, maybe just a little too much.  They think they can deduct the whole thing – but there are limitations.  Let’s discuss them.

Question: For business travel, are there limits on the amounts deductible for meals?

Answer:

  • Meal expenses are deductible if your business trip is overnight or long enough that you need to stop for substantial sleep or rest to properly perform your duties. Meal expenses are also deductible if the meal is business-related entertainment. You can figure all your travel meal expenses using either of the following methods:
    • Actual cost. If you use this method, you must keep records of your actual cost.
    • The standard meal allowance, which is the federal meals and incidental expense (M&IE) per diem rate. The GSA website lists these rates by location. Note that lower rates apply for the first and last days of travel.
  • The deduction for un-reimbursed business meals is generally subject to a 50% limitation.

If you have further tax questions please send it to:  tax@icontaxgroup.com