Business Meals

As a business owner if you entertain your customers, clients, or employees the cost of your meals may be deductible as a business expense, so long as the meal was directly related to or associated with your business. Generally, the deduction for business meals is limited to the 50%, however, there are certain circumstances where your meals could be 100% deductible.


Faruk is a web designer and developer who also monitors and regularly maintains his client's websites. He has two employees who rotate working double shifts to ensure Faruk's clients can still be serviced outside of normal business hours. Because his employee working nights has limited time to leave the office during his shift, Faruk orders food to be delivered to this employee every evening. When Faruk is ready to file his taxes, he would be able to deduct 100% of these business meals on line 24b of his Schedule C since the night shift meals purchased were for Faruk's benefit.


Ellen is an author who is about to finish writing her 6th novel, which she wants to ensure is placed in all major bookstores across the country. She arranged a meeting with her publisher at a steakhouse to discuss how they can best bring her new novel to market. During this meeting, Ellen spent $280 on food and drinks. When Ellen prepares her Schedule C, she could deduct $140 (50% of the $280) for this business meal.


Wong is an Uber driver who always goes home for lunch when ride requests slow down. However, last week she responded to a ride request that took her all the way from San Diego to Los Angeles. After dropping off her passenger, before turning around to make the long trip home Wong purchased lunch from drive through restaurant. Since Wong was buying her lunch for purposes directly related to business, she could deduct 50% of this meal on her Schedule C.


Tom is a landlord who is based in Denver, Colorado but owns and manages several rental properties in Southern Colorado. Often times, Tom will travel to Southern Colorado for three day periods to tend to his rental properties. Typically, while Tom is away he spends $300 on food. When Tom prepares his taxes $150 (50%) of his travel meal expenses will be deductible on Line 6 of his Schedule E.


Jackie is a serial entrepreneur with her own software business who recently traveled to Miami, Florida to attend tech conference hosted at a new nightclub. While at the club Jackie met an old friend who was interested in her latest startup idea. While they were talking, Jackie ended up purchasing $170 of cocktails and bar snacks. Even though she was discussing her latest business idea with her friend,she may not be able to deduct her cocktails as a business meal since the IRS could consider the environment to have substantial distractions that would prevent her from actively conducting business, however, she would be able to deduct her ticket to the event as a business expense.


  • You can generally deduct 50% of your business meals if the purpose of the meal is directly related to business or if the meal occurs directly before or after an interaction directly related to business. Business may include but is not limited to discussing current projects, planning future projects, discussing industry trends, and pursuing leads that could generate future income, etc. Note that you do not have to meet any specific time requirement for discussing business, your meal simply must occur for a legitimate business purpose.
  • Extravagant and / or lavish meal expenses are not allowed. There is no specific dollar value for what would be considered lavish, rather, it is based on what one would consider reasonable given the specific circumstances. If your meal is deemed lavish or extravagant, the reasonable cost of your meal would be deductible and anything exceeding the reasonable threshold would be disallowed.
  • Generally, only 50% of your business meal costs are deductible. However, if you incur costs to organize social events for low-paid employees, host promotional events (i.e. a pharmaceutical sales rep who buys dinner for a group of doctors who listen to a sales pitch), or provide meals to more than 50% of your employees on the premises of your business for your benefit these costs could be 100% deductible.
  • If you pay for a meal at a charitable event, some or all of these costs could be considered a donation and be 100% deductible on your Schedule A. Refer to our charitable deduction page for more details. Additionally, certain food costs could be considered gifts (i.e. you send a client food to be consumed at a later date), and be deductible subject to IRS limits.
  • If you incur business meals costs while with a spouse, relative or friend you may not deduct any portion of their expenses unless they are your employee, partner, professional advisor, customer, or other party who joined you for a legitimate business purpose.
  • Make sure to hold on to receipts from your business meals so you can determine which expenses are 50% vs. 100% deductible and so you can substantiate your deductions

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