Question

CA meal deduction default to 50% on Turbo tax business

Forum|Forum|4 years ago
April 6, 2022
1 reply
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Hello,

I finished my business's federal form 1065. On 1065, the meal was deducted 100%. However, once those information automatically imported to file my CA state tax 568, it only allows me to deduct 50% of the meal expenses. Please advice.

Also, how much meal expense is too much in IRS's eye?

Thank you for your answer in advance

J

JohnW152

For 2021 and 2022 federal partnership returns, you can deduct 100% of the cost of a business meal that’s purchased in a restaurant.

However, California doesn’t conform to the federal legislation, and the amount remains at 50%.

Please see Federal/State Differences in the 2021 Partnership Tax Booklet | California Forms & Instructions 565 for more information.

As for how much meal expense is too much for the IRS, there’s no real rule of thumb. You might see the IRS’ Internal Revenue Manual 4.31.9 Centralized Partnership Audit Regime (BBA) Field Examination Procedures | Internal Revenue Service, for some indication of their audit guidelines. The Audit Techniques Guides (ATGs) are also helpful, although they’re not partnership targeted.

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