Changes on business expense deductions for meals & entertainment

The Internal Revenue Service issued guidance on the business expense deduction for meals and entertainment following law changes in the Tax Cuts and Jobs Act (TCJA).

The 2017 TCJA eliminated the deduction for any expenses related to activities generally considered entertainment, amusement or recreation.  Taxpayers may continue to deduct 50 % of the cost of business meals if the taxpayer (or an employee of the taxpayer) is present and the food or beverages are not considered lavish or extravagant. The meals may be provided to a current or potential business customer, client, consultant or similar business contact.  For 100% meals provided to employees at a business meeting are accepted if there is proof of the meeting.  We suggest a company email be sent out with the meeting date & time and have a sign-in sheet for employees at the meeting.