Good news: the Tax Cuts and Jobs Act (TCJA) removed the “directly related and associated with” requirements from business meals.

We like these rules!

Restaurants and Bars

Question 1.  If you take a customer out for a meal, for business reasons, but you do not talk business, can you deduct the costs of the meal?

Answer 1.  Yes.  Even though you did not discuss business, you may deduct the expenses for meals if they are ordinary and necessary expenses.

Meals Served in Your Home

Question 2.  Can you deduct a business meal served in your home?

Answer 2.  No.  The IRS says that you must clearly show that the expenditure was commercially rather than socially motivated.

Ordinary and Necessary

The Supreme Court noted that “Necessary” means “appropriate and helpful.”  The dictionary defines “ordinary” as “occurring in the regular course of events; normal, usual.”

In essence, you shouldn’t have a problem in reaching the deduction criteria for your business meals.

Document the Meal Deductions

Keeping records that prove your business meals are ordinary and necessary business expenses is crucial.  You can accomplish this by doing these things:

  1.  Get receipts that show the purchases.
  2. Get proof of payment.
  3. Take note of who you had the meal with.
  4. Keep a record of the reason behind your business meal.

Deducting business meals has never been easier under the TCJA.

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