Expensing meals

Meal at a restaurant with clients or potential client are generally regarded a Meals AND Entertainment and subject to a 50% deduction.  

Examples:

• Traveling away from home (whether eating alone or with others) on business,
• Entertaining business customers at your place of business, a restaurant, or other location, or 
• Attending a business convention or reception, business meeting, or business luncheon at a club.

You may include Taxes and tips relating to a business meal or entertainment activity in the amount that is subject to the 50% limit.

 Types of records you should keep: 

• The person entertained and their connection with your business,
• The business purpose,
• The date, time, and place, and
• The cost of the expense.
  
  

Lastly, the following expenses are generally NOT considered directly related when entertainment occurs because of substantial distractions, there is little or no possibility of engaging in the active conduct of business. Examples are: 

• A meeting or discussion at a nightclub, theater, or sporting event, •
• A meeting or discussion during what is essentially a social gathering, such as a cocktail party, or 
• A meeting with a group that includes persons who are not business associates at places such as cocktail lounges, country clubs, golf clubs, athletic clubs, or vacation resorts.

Travel & Entertainment Expenses - IRS 

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