| When preparing our income taxes, we all look for | | | | 50% deductible but that's not always the case. When |
| every deduction we can find, especially individuals that | | | | you host that holiday office party or company picnic, |
| are self employed. Self Employed individuals or those | | | | you can deduct 100% of that meal. The wonderful |
| that travel a lot for employment often discover there | | | | coffee, donuts and snacks you provide to your |
| are more things they can deduct than they realized. | | | | employees are also 100% deductible. Even those little |
| Meals are one item that is often a "touchy" subject as | | | | dishes of candy you see on office desks are 100% |
| tax payers are uncertain as to what they can deduct | | | | deductible for that business. |
| and what they can't. Although meals are considered a | | | | Occasionally an employer will have a heavy workload |
| legitimate business expense, there are requirements | | | | that requires some of the employees to stay late or |
| that must be met because while they are a business | | | | work on the weekends when they're not normally |
| requirement, they are also an ordinary requirement. | | | | scheduled to work. Because it's the employer that |
| In order for meals to be deductible they must meet | | | | needs the workers there, the meals they provide to |
| both of these requirements. Generally, meals are 50% | | | | the employees are 100% deductible. There are some |
| deductible on your income tax form. What this means | | | | stipulations to this rule, however. The meals must be |
| in terms of your taxes is that if you or your business | | | | served on the employer's premises and more than half |
| pay for a meal, 50% of the price can be deducted on | | | | the employees must be working for the employer. |
| your income taxes. There are, however, exceptions to | | | | If you are paying for a meal that you will be |
| the 50% rule and it's important to understand the | | | | reimbursed for by the client you can deduct the price |
| exceptions because some of your meals may be | | | | of the meal 100%. This is a situation where you may |
| 100% deductible. | | | | pay for the meal while you're eating and then later put |
| Some of the guidelines for meals that are 50% | | | | the price on a separate invoice line with his ordinary bill. |
| deductible are as follows: | | | | You often see these types of bills between an |
| - Meals eaten with your customers, clients and | | | | attorney and his client. The price of the meal will be on |
| vendors | | | | a separate line on the invoice, which means the |
| - Meals with your partners, directors, shareholder and | | | | attorney can deduct it 100% but the client can only |
| employees | | | | deduct it 50%. So, keep in mind, if you want to deduct |
| - Meals during the course of your travel | | | | a meal such as this, you cannot add it into the entire |
| - Meals eaten while you're at a convention or seminar | | | | price of a bill. It needs to be itemized on a separate line. |
| for business | | | | If it is lumped together with a service fee or similar fee, |
| As stated up above, even though most of the meals | | | | the percent flip flops. In other words, the client can |
| are 50% deductible for your business, some can be | | | | deduct it 100% while the business only gets a 50% |
| 100% deductible. Make sure you know the difference | | | | deduction. As you can see, it's very easy to covert a |
| as it can make a huge difference in your tax | | | | 50% deductible meal to a 100% deductible meal legally |
| deductions. | | | | and save some tax dollars. |
| It probably seemed above that all your meals are only | | | | |