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Joseph A. Schilz, CPA can help both individuals and businesses get the greatest-allowable benefit from available employment-related deductions. Following are a variety of meal- and entertainment-related expense categories and types typically considered deductible, and a comparison of whether a full or limited deduction commonly applies in each area:

Note: These are general guidelines and cannot be considered tax advice. Deductibility may vary based upon individual facts. Review the facts with your accountant.

Employee Business Events
Expense Type Fully
Deductible
Subject to
50% Limit
Examples
Business Meetings Lunch with coworker or client to discuss business
Out-of -office meal while attending training or professional meeting Dinner paid for by employee and reimbursed by employer after a training seminar
Meal & entertainment for highly compensated employees Dinner/entertainment exclusively for managers at country club for recreational purposes
Meal for occasional office meeting for the convenience of employer Lunch ordered for quarterly department meeting
Meal for occasional large group sales or promotional meeting Lunch for large group during sales seminar hosted at a hotel or conference center
Meal during conferences, seminars or training schools Lunch provided by employer at training seminar hosted at a hotel or conference center; breakfast buffet hosted at conference center during regional sales meeting
Occasional in-office working meals Dinner ordered and paid for by employee while working overtime; meal reimbursed by employer
Nominal food and beverages Bagels, doughnuts, coffee and juice provided during meetings or social gathering
Employee Out-of-Town Expenses
Expense Type Fully
Deductible
Subject to
50% Limit
Examples
Out-of-town travel not treated as compensatory Reimbursement to employee not included in employee’s compensation for meal expenses incurred on business trip
Out-of-town travel treated as compensatory Meal expenses incurred during a business trip included in employee’s compensation
Travel & Lodging Mileage, airfare and hotel accommodations for out-of-town business meetings
Client Business Events
Expense Type Fully
Deductible
Subject to
50% Limit
Examples
Client Business Meetings Business dinner or golf outing to develop client relationship
Employee Social Events
Expense Type Fully
Deductible
Subject to
50% Limit
Examples
M&E expenses incurred for social or recreational purposes primarily for the benefit of employees other than highly compensated employees Retreats for employees to encourage team building; summer outing for employees and family; holiday party for employees and family; employee happy hour
Meal expenses (not including entertainment), if for the benefit of highly compensated employees Celebratory dinner for corporate executives to commemorate a record-breaking year end
Recognition/Mentoring/Miscellaneous Expenses
Expense Type Fully
Deductible
Subject to
50% Limit
Examples
Mentoring program Mentoring lunch to discuss employee’s performance
Nondiscriminatory events that recognize individual or group achievements Retirement luncheon to celebrate employee’s years of service to company; employee’s anniversary party with the company; reward dinners
Qualified charitable events for employees and clients Tickets for employees or clients to professional golf tournament that benefits charity; meal tickets to a charitable dinner
Tickets to sporting or cultural events provided to employees on a nondiscriminatory basis Tickets given to employees for celebrity golf tournament as a reward for services
Room charges and audiovisual equipment for seminars, meetings, social events, etc. for non- entertainment Room charges for using the clubhouse for professional seminar; audiovisual equipment used during a sales meeting
Club dues included in employees’ compensation Country- and social- club dues are not deductible unless reported as compensation to employee
Dues for public or professional service organization Dues paid to legal or accounting association, Kiwanis or Rotary Club