Business Meal Tax Deduction | How to Write Off Food
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- Опубліковано 23 чер 2024
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Love food? Us too! That’s why we made this video about writing off meals on your taxes.
IMPORTANT INFO FOR 2022: Any business meals you get at restaurants are temporarily 100% deductible, thanks to the Consolidated Appropriations Act of 2021. Before, business meal deductions were capped at 50%, and they'll go back to that in 2023.
In this video, we’ll go over how the business meal deduction works - including which meals are and aren’t eligible, and how to keep records in case you get audited. Spoiler alert: You don’t need a French waiter or even a cloth napkin to take the business meal tax deduction.
In order to count as a business meal, the IRS says you need to be dining with a “current or potential business customer, client, consultant, or similar business contact”. “Similar business contact” is definitely on the vague side, so we’ll break down exactly what that means. Here’s a preview: it covers more than just prospective clients. Folks in your general line of work count. So do people you invite for a business discussion.
To make sure you’re covered, we’ll also go over what DOESN’T count as a business meal. Groceries are out, and so are snacks you eat while working - with some exceptions, which we’ll get into in the video. You also can’t write off a solo lunch, even if you take a call while eating.
Now, how do you keep records for all your eligible business meals? First off, hoarding paper receipts from restaurants isn’t actually necessary. Your credit card and bank statements will have all the info the IRS needs. But in case you do get audited, it’s a good idea to keep some digital breadcrumbs on hand. We’ll talk about what that means in the video.
TIMESTAMPS
0:00 - Intro
1:34 - What is a business meal expense deduction?
2:18 - How to take meal expense deductions
3:43 - What counts as a business meal?
6:07 - What doesn’t count as a business meal?
7:32 - How to keep records of your business meals
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LEARN MORE ABOUT DEDUCTING MEALS
The Business Meal Deduction: A Freelancer's Guide: www.keepertax.com/posts/freel...
When Are Meals 100% Deductible?: www.keepertax.com/posts/when-...
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But how would one prove it was a business meal if you get audited?
Great question, Kaela! We recommend leaving some digital "breadcrumbs" of the things you've discussed. One easy way to do this is to send an email to whoever you ate with after the meal summarizing what it is that you talked about. Think something like: "Hi, Alex! It was great meeting up to discuss X. After trading tips on Y, I'm excited to try out Z based on your advice. I'll keep you updated on how it goes. Please let me know if I can be of any help to you." Just an example, but you get the idea!
Other options include creating a calendar event or keeping some timestamped notes after the meal. Anything that makes the meal seem "official" would work for this. You just need something of this nature to show the IRS.
So can a food blogger content creator claim groceries and show the receipt and have video date to show the vid that you made.
Great stuff, made it very simple
This provided much clarity. I can now categorize my meals accordingly. Thank you
Great Video and Channel!
Dope!!! Thank you for making this video👌🏾💪🏾🙌🏾
Thank you for watching! 🌟
I absolutely love this video. Exactly what I was wanting to know. I have one suggestion, and maybe you have already done this since this is form several months ago. It is a little thing, but I think would make a big difference. The audio sounded like you were in an empty room and I think if you had a good mic close by, it would make a big difference. Like I said, a little thing and maybe I am the only one who notices this lol. Anyways, I love what you are doing and keep up the good work!
Wow this is very knowledgeable.
Thank you so much! 🙏
thank you 👏🏾
You’re welcome 😊
Thank you so much for this! You broke it down and gave examples that were easy to understand. ❤️
Enjoy your videos, question can you video conference a business meal? Ex. Zoom and write it off?
Hi Tyrique! Thank you for your question. The IRS doesn't have specific guidance on Zoom meetings, but it's safer to err on the side of not writing off Zoom meals, unfortunately.
What if you eat by yourself and discuss business to a waiter?
Hi loved this video but i have a question. Can you write off groceries if you are only buying them to cook healthy meals for a UA-cam videos?
Hi! Yes, ingredients that you use exclusively for making videos are considered supplies, and you should be able to write them off!
If a restaurant owner go on a trip (out of state/ country) to look for inspirations and new ideas for their menu, or checking out competitor’s foods, can the trip and meals count as business expenses and deducted?
My husband has a gospel group. Small business LLC. They were giving themself per diem checks for food and travel. We are just learning about tax write-offs. We keep track of all expenses already in case we get audited. They are on the road traveling every weekend and stop or go through a drive-through for meals. Would this qualify as a business meal?
I have an Yes corporation I paint myself with the w two can I write off Groceries. I know I get Cordia because of my coporation is logistics as a trucking.
Hi there Tyra, I have a quick question for you. My dad does chemotherapy treatment deliveries around the state that we live in, and is often on the road from 3AM until 3-4PM. I want to help him as this is his first time being classified as an independent contractor, so I am wondering if the meals that he purchases during his deliveries are deductible? Thank you for the content, I look forward to watching more of your videos!
Hi, Bryson! Great question. If your dad drives a commercial motor vehicle (CMV), or if he's required to sty on the road during the hours you mentioned, then his meals would be tax-deductible. Basically, eating mid-shift only counts as a deduction if it's a requirement for the job. It's such important work that your dad is doing. Wishing him all the best!
What if you take business partners to a gentleman's club, but for dinner to discuss a case? Are simply the dinner and drinks deductible? (No entertainment included).
Hello there, do have knowledge of 1099 for independent contractor CDL Drivers?
Hi, Michael! Yep, CDL drivers can definitely use Keeper Tax to track their expenses. If you'd like to try it out, you can get started here: keeper.tax/e/pZ7MisHnmkb
I am a 1099 contractor and I drive new cars for an automotive dealership. I deliver the cars to the customers that buys them. Can I right off my lunches or dinners that I may do during the delivery or hotel stays on long runs.
Hi Albert! You can definitely write off hotel stays during business travel. You can also write off meals during your deliveries for trips that involve overnight stays. Hope this helps, and thanks for your question!
If I work outdoor events for like 8-10 hours and I have job details emailed to me that say to "bring a lunch because you wont be able to leave the area" would that be enough to count as a meal expense?
Great question, Zach! In that situation, as a 1099 worker, you would be allowed to write off the cost of the meal. It's required to do the job, so it counts as a valid business expense
I heard for gig workers like uber we could write off meals, coffee, etc?
Great question! Actually, meal write-offs for gig workers are a bit of a tricky area. With the exception of meals you eat during business trips, you can generally only write off meals where you're discussing business with someone. (In the case of an Uber driver, that can be an aspiring driver you're interested in referring to the platform.) The same goes for coffee - you generally have to be drinking it with something while you're talking shop.
That means that, unfortunately, you can write off a meal that you're grabbing between rides, or a coffee that you drink to stay awake on long shifts.
If you'd like to learn more, here are a couple of articles:
- On meals deductions for Uber drivers: www.keepertax.com/posts/uber-driver-deduct-meals
- On writing off coffee: www.keepertax.com/posts/can-you-write-off-coffee-as-a-business-expense
My business is almost fully food related. For example, I’m an American living in Japan and I bought a whole bunch of candy for one video and a whole bunch of chips for another video. I sat down and tried each flavor, looked up what the Japanese words meant, etc and did an entire video on Americans reacting to Japanese food. Would those be tax deductible?
I also do cooking videos. For example I making a video on banana bread, miso soup, croissants, etc. Are the ingredients for those recipes tax deductible?
For restaurants, I take tons of pictures and then I write up blog posts AND I go out to eat for inspiration for my new recipes. For example, I tried a “sushi burrito” just for inspiration for a new recipe. What about those expenses?
Really good question, Alyssa! If you buy candy or chips solely for filming purposes and eat them on camera, then that's a deduction for you. The same goes for cooking ingredients that you prepare on screen. Here's an article where you can learn more: www.keepertax.com/posts/can-you-write-off-products-you-review
The restaurant meals you eat for research purposes are in more of a gray area - there isn't a lot of case law here to fall back on. To stay on the safe side, it might make sense to conduct this kind of food research in tandem with traditional business meals, where you're talking shop with a colleague or potential sponsor.
What about if im a travel nurse on an assignment out of state. (1099) do all my meals and snacks qualify?
Great question! If you're on a short-term contract away from your tax home, your meals should qualify as business travel expenses. To make a case for that, your out-of-state assignment should be less than a year, and you should maintain concrete, material ties to your actual home state - like paying rent or a mortgage there, having a partner or family live there, and being registered to vote there.
Curious, Can you write off business discussions that happen over zoom, phone, etc.
Hi! The IRS doesn't have specific guidance on writing off meals during Zoom meetings, but it's best to err on the side of not writing off Zoom meals, unfortunately.
Can Rideshare drivers deduct their meals expenses while on the road?
That's a great question, Gina! In general, the answer is no. But there's an exception if you end up traveling at least 100 miles away from home for driving (for example, to try to take advantage of a special event like a music festival). In that case, your trip would count as a business trip, and the meals you eat while you're there would be deductible!
If you'd like to learn more about this (somewhat complicated) topic, check out this blog post! www.keepertax.com/posts/uber-driver-deduct-meals
#young and hungry
4.00 your welcome
Hi Im a nurse and an independent contractor traveling in different facilities. do i need to keep my receipts for every lunch meal i made during my work?
Hi there! It's good to keep documentation for your expenses, but you don't necessarily need to keep every receipt. Read more here! www.keepertax.com/posts/receipts-for-taxes
What about groceries from your home? And you eat at home?
Sorry, stocking your home office with groceries doesn't count. More info here: www.keepertax.com/posts/freelancers-guide-to-the-business-meal-deduction
This app is a godsend, and quite literally, #BlackGirlMagic :)
So glad it's been helpful for you, Aaron!
Does food bought to stock food for employees count as a business meal deduction?
Hi, Faythe! Yes, it does.
6:34 aw man..
I feel your pain, Michael!
So if you have a zoom meeting and go out to eat -could you write it off with proper documentation?
Sorry! Solo meals are not eligible. Take a look at this list to know more about what you can and cannot write off: www.keepertax.com/posts/freelancers-guide-to-the-business-meal-deduction
Can business owners take meal expenses if they have a company dedicated to filming in different parts of the world ?
Hi! Self-employed workers can deduct qualifying business meals, which are generally with a client, with a prospect, or for networking purposes. Rule of thumb: If you're alone, it's probably not a write-off. More details here! www.keepertax.com/posts/freelancers-guide-to-the-business-meal-deduction
As a content creator that sometimes reviews restaurant meals and food for video content, are those meals 100% or only 50% deductible?
Hi, Nona! For any of those restaurant meals you bought in 2022, you can take a 100% deduction. After that, it goes back down to 50% (which is the usual deduction limit).
@@KeeperTax thank you for the clarification! :)
What about a social worker that is on the road 8-10 hours per day visiting clients. Paid as a 1099 independent contractor. Can the social worker use a meal deduction?
Hi, Randal! Really good question. A 1099 social worker can potentially treat the sort of meals you're talking about as business travel expenses, but that requires leaving their tax home. If they're driving far enough that they'd have to rest somewhere before returning home, that would generally count. But unfortunately, if they're staying around the same general area where they live and work, their meals wouldn't be deductible.
@@KeeperTax thank you. Interesting. So I would imagine there's a grey area here. "far enough that they'd need to rest somewhere" - guess that's kind of subjective then. Appreciate your help.
Hey question! Many times me and my wife are working all day on our business. Between shipping, customer service, etc.
We are always so busy we eat out quite a bit. But it’s either in our cars because or bring it to work and eat.
Does this apply in your opinion?
Great question! Unfortunately, this is a tough one. Unless you and your wife are eating these meals while on a business trip, it's unlikely to fly with the IRS.
One exception: If your business has employees, and you're providing them with these meals to help them work longer hours, you would be able to write them off. But not if it's just you and your wife!
I should’ve watched this two years ago smh
Some of this isn't true. You can write off simple things like coffee for the office, even if it is just for you while you are working.
💎GEMS💎
I am a contractor and my client requires me to be at my desk from 10-3. If I eat lunch is this deductible?
Did you ever get this answered?
Sorry! Solo meals are not eligible. Take a look at this list to know more about what you can and cannot write off: www.keepertax.com/posts/freelancers-guide-to-the-business-meal-deduction
Do creators that review food get a tax write off.
How does one deduct a meal you didn't pay for?
Unfortunately, you can only deduct meals that you actually paid for! So if you're eating with a client or a work buddy and they pick up the tab that time, it would be a write-off for them - not for you.
If you split the bill, though, you can definitely write off your portion!
How would they know I’m at the restaurant WITH the client ?
Hi Johan! We recommend leaving some digital "breadcrumbs" in case you need to show the IRS. That could be an email you send to the client after the meeting ("Great to see you! Glad we could discuss [topic]"), a calendar event, or notes you take during the meal. A record of some kind!
You are able to write off groceries if you are traveling
That's right! We talk about this in our video on deducting travel expenses: ua-cam.com/video/dX12bqf0-1E/v-deo.html
If I have volunteers helping me with my business for day (I’m a sole proprietor), can I write off a thank you lunch while we’re working?
Good question, Emily! If you're hosting an appreciation event for your volunteers, that count as a business meal, so you can write it off.
@@KeeperTax thank you! I just found this channel and it’s been very helpful :)
@@emilyhope7721 Thanks for watching, Emily!
#YoungandHungry
what if your business partner is your wife?
Excellent question! The short answer: It's safest to invite someone else along - a current or potential client, partner (other than your wife), contractor, or mentor.
The longer answer: The IRS doesn't have any firm guidance on business meals with a spouse who's also your business partner. But there's a court case that indicates you should be super careful about deducting these sorts of meals. That's the 2012 case of Fitch v. Commissioner. In this case, a couple that did business together tried to write off a bunch of spousal meals, but they were only able to give "general, vague, and conclusory" testimony about why those should count as business meals. At the end of the day, they didn't meet "their burden of proof" that the meals were really "ordinary and necessary business expenses." You can read more here: www.bradfordtaxinstitute.com/Endnotes/TC_Memo_2012-358.pdf
Based on this case, the IRS is likely to scrutinize business meals between spouses a lot more carefully than OTHER business meals. It's possible that you could make a case for spousal meals if you were able to provide a detailed agenda of the business-related items you discussed at each meal. But to be on the safe side, bring someone else along to talk shop. That way, there's no risk of it looking like a date night!
#youngandhungry
If water and candy can legitimately be a write off then all the food can as well be deductible. No one can prove you didn’t provide free food for riders.
That's a great question! Unfortunately, if you get audited, it would be on you to prove that the food was actually for riders - and you'd get dinged if you can't.
If the IRS looks into things, they'd take a look at details of the transactions you give them. If a purchase says "Subway" instead of "Walmart" or something, they'd probably put two and two together!
Another thing they'd look out for is realistic amounts. If you try to write off $5,000's worth of expenses claiming it's water bottles and granola for your passengers, they'd try to match that up to how many passengers you have on your books. (If every passenger takes a water bottle and a granola bar, averaging about $4 a passenger, that should be around 1,250 passengers a year, or 3-4 rides every day - including weekends and holidays!)
# young and hungry