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ksaylor
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As a contractor can i deduct all meals paid for while working?

 
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2 Replies

As a contractor can i deduct all meals paid for while working?

Whose meals?

 

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GiseleD
Expert Alumni

As a contractor can i deduct all meals paid for while working?

It depends on the nature of the meal and the location. If you are self-employed, meals are generally deductible if incurred while traveling on business or while entertaining a client, customer, or employee. For local meals, while entertaining business associates and clients, taxpayers may deduct 50% of an otherwise allowable business meal expense if:

 

• The expense is both ordinary and necessary and paid or incurred during the tax year in carrying on a trade or business.

• The expense is not lavish or extravagant under the circumstances.

• The taxpayer, or an employee of the taxpayer, is present.

• The food and beverages are provided to a current or potential business customer, client, consultant, or similar business contact.

 

The deduction for meals while out of town is calculated by using actual costs or the standard meal allowance under the per diem rates. A deduction for meals is generally limited to 50% of the expense. The limit also applies to taxes and tips relating to a meal.

 

For further information, please see IRS PUB 535, Business Expenses.

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