Discussion:Board of directors meeting
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Discussion Forum Index --> Basic Tax Questions --> Board of directors meeting
Discussion Forum Index --> Tax Questions --> Board of directors meeting
| 6 October 2008 | |
| I have clients who are partners and they are married. They want to deduct a stockholders meeting held in Cancun. They are the only stockholders of their LLC. Is this an allowable deduction? | |
RoyDaleOne (talk|edits) said: | 6 October 2008 |
| In could be, but most likely it is not an allowable deduction, or even close. | |
| 6 October 2008 | |
| Any compelling reason why this husband and wife "had to go" to Cancun to hold their Meeting - when they could have done so at the kitchen table in their home any other time.
You will be hard pressed to convince an IRS examining agent of the "necessity" of going to Cancun to meet. You may be at risk for a Preparer Penalty for deducting this - the worse part for you is that you open the door for them to deduct trips to Paris, Hawaii, etc. for their next "Meetings". | |
Death&Taxes (talk|edits) said: | 6 October 2008 |
| We used to say, 'Can you describe it without smiling?' | |
| October 6, 2008 | |
| Puhleeze. I often ask my clients to invite me to the meetings, but natch. | |
| 6 October 2008 | |
| Okay. I said it couldn't be deducted, but my client wants references from the IRS or tax guide or somehthing, and I cannot located anything to back up my opinion. Anyone know references that state that this is nondeductible | |
| 6 October 2008 | |
| I agree with D&T, I have always called it the "straight-face" test. If I can't keep a straight face while I explain it to the examiner - it is not deductible. | |
Death&Taxes (talk|edits) said: | 6 October 2008 |
| You might start with Sec. 274(a)(1)(A), then go on to Sec. 162(a) and the phrase 'ordinary and necessary.' Usually when the arugment drops to this level with a Revenue Agent, I drop Robert Noyce's name into the discussion, but Mr. Noyce was a founder of Intel and had a reason to deduct the use of his private plane, which the courts saw. Idiots like your clients take you down with you when you try to justify such reasoning. | |
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