By Dida Clifton, TheOfficeSquad®
Buying a Starbucks on the way to work is not a meal & entertainment business expense. It is only considered a legitimate meal and entertainment business expense when you have a client or employee and business is discussed and it is recommended to jot down on the receipt the other person's name and what was discussed briefly.
Tickets to the ball game is a gift business expense but the drinks and meal prior to the game is a meal and entertainment business expense. (because it is almost impossible to discuss business during a game).
Oh and while we're in Vegas, evenings at the Spearmint Rhino better have a receipt with the name of clients you were "entertaining".
Just because you enjoy a delicious Starbucks beverage on the way to work, does not mean you can it write off. Nor can you write off the quick lunch at the fast food drive through.
The IRS has some strict guidelines regarding meal expenses.
Meal expenses are deductible only if your travel requires you to be away from home overnight or 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 M&IE rate.
The deduction for non reimbursed business meals is generally subject to a 50% limitation.
You've been warned.
Dida Clifton, TheOfficeSquad®
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