Author: David Ellison
The Tax Cut and Jobs Act (TCJA) changed the deductibility of Meals and Entertainment. Prior to TCJA, business meals and entertainment were typically 50% deductible. The TCJA changed that by eliminating the tax deduction for entertainment. So where does this leave business meals?
Nothing has changed for the traditional business meals with customers or prospective customers or meals incurred while traveling. These are still 50% deductible. What has changed are meals as part of entertainment. If the meals are included as part of the entertainment, for example, a fee for a luxury suite at a sporting event, the entire fee is non-deductible entertainment. However, if the cost of the food and beverages is separately stated, or is a completely separate charge, then the cost of the food and beverages is 50% deductible and the cost of the entertainment is non-deductible.
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