Meals and entertainment expense

Meals and entertainment expense

A tax deduction allowed for meals and entertainment expenses incurred in the course of business.

Meals and Entertainment Expense

Money that a business spends in the course of buying meals for or otherwise entertaining a client, customer, or employee. In the United States, one may deduct meals and entertainment expenses from one's taxable income, subject to certain restrictions. In general, one may only deduct up to 50% of meals and entertainment and must be able to prove that one conducted business with the person that one was entertaining.
References in periodicals archive ?
Would all meals and entertainment expense be reported on Part IV, line 11?
Therefore, items such as federal income taxes, fines, penalties, disallowed interest expense, the disallowed portion of meals and entertainment expense, and similar items probably do not reduce ACE even though they reduce E&P.
Therefore, items such as federal income taxes, political contributions, penalties, disallowed interest expense, the disallowed portion of meals and entertainment expense and similar items do not reduce ACE even though these items reduce E&P.
Many business owners, self-employed individuals, and other taxpayers are aware that business meals and entertainment expenses are only 50% deductible.
A business can deduct 50 percent of business-related meals and entertainment expenses.
Currently, small businesses can deduct 50 percent of their meals and entertainment expenses from their federal tax filings.
The procedure also contains substantive updates to the list of "high-cost localities" used in the "high-low" substantiation method and to the deductible percentage of business meals and entertainment expenses of certain transportation industry employees.
Meeting with Tax Legislative Counsel and other Treasury and IRS representatives to discuss proposed revenue procedure on statistical sampling in respect of meals and entertainment expenses (7/2/03).
The Tax Court held that, under applicable revenue procedures, the entire per-diem travel allowance paid by a trucking company to its drivers was subject to the 50% deduction limit on meals and entertainment expenses, because it was computed on the same basis as wages.
This plan would create a tax deduction for spousal and dependent travel, and would boost the tax deduction for business meals and entertainment expenses to 65 percent for businesses with annual incomes of less than $5 million.
Meals and entertainment expenses qualify for a deduction if they meet at least one of two tests.
In "The High Cost of a Free Lunch," (JofA, June00, page 61) the author says IRC section 274(n)(2) provides several exceptions to the 50% limitation on meals and entertainment expenses.