Discussion:100% meal deduction
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Revision as of 20:26, 15 May 2008
Discussion Forum Index --> Tax Questions --> 100% meal deduction
Www.cpa1.biz (talk|edits) said: | 22 April 2006 |
| When should a taxpayer take the whole 100% meal deduction when they have a Schedule C and why does like any employee not take a 50% meal deduction on the form 2106 just for everyday lunches that they do not get reimbused from their employer. Please enlighten.
Thanks, www.cpa1.biz | |
| 22 April 2006 | |
| M&E are deductible at 50% generally and a Schedule C will take this 50% deduction as it relates to his/her business.
Employees do not file Form 2106 arbitrarily. They file this form if they have ordinary expenses related to their employment that are not reimbursed by the employer such as overnight travel or entertaining customers or clients. You cannot deduct the cost of simply having lunch as being an unreimbursed employee business expense. The expense has to be for the benefit of your employer.... | |
Www.cpa1.biz (talk|edits) said: | 22 April 2006 |
| Thanks a lot Sandy..have a good weekend....
www.cpa1.biz | |
| 22 April 2006 | |
| There are certain instances where 100% deduction is allowed for M&E. Meals consumed on employer's premises for the convenience of the employer are 100% deductible (e.g., that pizza I ate at 8:00pm in my office during tax season). Meals that are billed out to client/customer and separately stated are 100% deductible to the biller and 50% deductible to the billee (e.g., travel expenses, including meals, that are billed out to the client as a reimbursable expense are 100% deductible, but the client may only deduct 50%).
As to deducting everyday lunches on Form 2106, meals are deductible when there is a business connection. When I go the Wendy's day after day, there is no business connection, and thus no deduction is allowed. | |
| 22 April 2006 | |
| My business is an S corp and, as such, I am not considered an employee for purposes of the 'for the convenience of the employer' 100% deduction (or any deduction that I know of). So, my pizza at 8:00 is not deductible. How do you deduct yours???? | |
| 22 April 2006 | |
| Wouldn't a Christmas party and the meal or a summer picnic be 100% deductible to the business owner? where i work we have a pizza party every quarter if there are not lost time accidents, wouldn't this alos be 100% deductible to the owner? | |
| 22 April 2006 | |
| I usually deduct 100% for office party food and supplies under Supplies. | |
| 30 November 2006 | |
| If an S-Corp bills it clients the per diem rate for meal cost, can they write off 100% or do you have to bill them for the actual cost in order to get the deduction for 100%? | |
| November 30, 2006 | |
| Dennis - you crack me up! As far as the office parties go, wouldn't they qualify as de minimis fringe benefits? I realize they often get reported under office expense or supplies, but I've always thought of them as another benefit. | |
| 30 November 2006 | |
| Has anyone heard of the "merchant sailor meal allowance"? = employed as a tug/barge sailor(transportation industry) and allowed to use the M&IE per diem rate, reduced by employer provided grocery allowance, and then deduct 100% of remaining for their meal allowance. Check out SailorTax.com. I have several tug boat captains who INSIST on this deduction using Form 2106. | |
Death&Taxes (talk|edits) said: | 30 November 2006 |
| You might read the recent Bissonette decision in the US Tax Court; I don't recall this method being used there, and he captained a ferry on Puget Sound. | |
| 2 February 2007 | |
| So, owners of a retail shop buying their lunch and eating at the shop isn't deductible in any way. But, if they buy a pizza for them and all the employees and maybe talk about business in the process, it is deductible, but 50% deductible?
I am a sole shareholder of an S-corp and sometimes I buy a sandwich and eat it in as I'm working, as LJACPA says, since I am not in an employer/employee situation, it is not dedcutible? But the IRS makes me pay myself with W-2 wages, so in that respect and am the employer and the employee. It's sooooo confusing! Can anybody point me to specific regs to read....I'm going to look them up. | |
| 2 February 2007 | |
| The IRS is trying to keep people slim. What would happen if they allowed the 100% for general business purposes (feeding the boss)? OBCT!! O.o | |
Johnspokes (talk|edits) said: | 11 February 2007 |
| So am I to take it that a restaurant whose workers get a free meal during their shift can't get a deduction for it? Presumably because the cost of ingredients and paid time is already an expense? | |
| February 11, 2007 | |
| Yes, the cost of the food will be included in cost of goods sold. | |
| 12 February 2007 | |
| If the employees eat in an employer operated eating facility and the employees are provided meals for the convenience of the employer, the meal is an excludible fringe benefit under Sec. 132(e)(2) and the employer may deduct 100% of the meal costs under Sec. 274(n)(2)(B). | |
| 12 February 2007 | |
| MsTwizz, there are a number of situations where a >2% s/h, though a bona fide W-2 employee, is not considered an employees. One is for meals, another is participation in a Section 125 plan. I'll let Riley give you a cite. | |
| 19 February 2008 | |
| My twist on this is for employer provided meals while at a job site. I have a client who send his guys all over the world to install his product. They maybe gone two days or two weeks. Are the meals the company pays for during these jobs 100% deductible? They are on the job working for the employers convenience? | |
| 15 May 2008 | |
| The following is the specific situation I have. I work for an LLC. There are two members (owners) of the LLC that are active in the business. They work 12+ hour days and rarely leave the office. So that they can continue working throughout the day, they have both their breakfast and lunch brought in. Are these meals 100% of 50% deductible? Thanks in advance for any guidance. | |
Death&Taxes (talk|edits) said: | 15 May 2008 |
| Try zero percent deductible. See Publication 463 They are neither out of town in travel status, nor are they entertaining anyone.
Would be neat if they were deductible. During tax season I walk from my bedroom, through the kitchen and to my office. I set the coffee to drip, put some toast on, and begin to work. Same with lunch; gee, if I can get this I will get an account at the local Dunkin Donut to prove my costs and start deducting. | |
| May 15, 2008 | |
| "Employees forced to eat meals provided by employer for the convenience of the employer" sounds like a good episode premise for The Office. Think tofu, brussel sprouts, anchovies etc. | |
