50% (Standard) Meals

• Restaurant meals with clients, prospects, or vendors
• Meals while traveling overnight for business with or without team 
• Working lunches and snacks for employees...get creative here!
  
  

100% Meals - the Gold Standard!

• Annual parties or picnics open to all employees of your company (Whether 2 or 200)
• Food offered to the public, such as refreshments at an open house or an open business party
• Food included in a charitable-event sponsorship where the charity is the primary beneficiary
  
  

The 0% Deduction...unfortunately! 

• Food bundled into entertainment when the price is not shown separately on the invoice!  This is KEY!
• Purely personal meals with no bona fide business discussion - IE you went to lunch by yourself on Tuesday  

After 2017, Entertainment is no longer deductible (think tickets, golf etc).
When food is served alongside entertainment, the entire bill becomes nondeductible unless the food charge is listed separately. Use these steps to preserve the meal deduction:

1. Ask For Itemized Invoices from the vendor
   1. Request that the venue break out food and beverages on a distinct line from the entertainment charge.
      
      
2. Document The Business Purpose
   1. Keep a brief note in your expense app: date, venue, attendees, and the specific business topic discussed.
      
      3. Save The Detailed Receipt

1. Credit-card summaries alone are not enough; the IRS wants to see the itemized bill showing the separate meal charge.
   
   

By keeping food and entertainment on different lines, you protect the 50% deduction for the meal portion while accepting that the entertainment piece is not deductible.

• Board Or Strategy Meetings Over Meals (Including BOD with your Spouse or Family)
  • Hold formal meetings at a restaurant and capture the deduction while producing contemporaneous minutes that prove the gathering’s necessity.
    
    
• Lunch-And-Learn Sessions
  • Cater training events for employees. If the session is available to all staff, the cost is 50 percent deductible and 100 percent if it qualifies as an annual company-wide social event.
    
    
• Accountable-Plan Reimbursements
  • Reimburse owners and employees for client meals through an accountable plan. The business deducts the meal; the employee avoids taxable wages.
    
    
• Combine with the Augusta Rule!
  • Use the Augusta Rule to rent our your home, tax free, and ALSO write off the meals at either 100% of 50% depending on the circumstance
    
    
• Holiday Or Milestone Celebrations for your Team
  • Plan at least one all-hands social event each year. Food and drink are fully deductible when the occasion is open to the entire workforce.
    
    
• Separate Charges At Entertainment Venues such as Golf, Sports, Concerts
  • When hosting clients at a sporting event, ensure that food/drinks are separated from the entertainment charge to make the expenses deductible. 

• Property-Inspection Travel or Management Travel to Look at Assets
  • Meals consumed on overnight trips to acquire or manage rental property qualify for the 50-percent travel-meal deduction when you as the investor is engaged in an active trade or business.

 

• Partner And Lender Meetings
  • Meals with private lenders, property managers, or co-investors are deductible so long as a clear business discussion occurs and everyone’s name and role are documented.  So if you invest with your friends, take them out once in a while!

1. Who, What, Where, When and WHY!
2. Save Itemized Receipts, not just credit-card slips.
3. Use Digital Expense Apps that store images and prompt for business purpose fields.

• Update or adopt an accountable plan for owner and employee reimbursements for items paid personally that should be reimbursed (S Corp, C Corps)
• Schedule at least one fully deductible social event each year.
• Combine with the Augusta Rule!

While the meals deduction is not going to make or break your tax strategy, it is a good way to "chip away".  By being strategic, you can take items that are normally nondeductible and loop in a business purpose to make the expense partially deductible. If you have questions on executing, as always, contact your Anomaly PM.