Are meals/entertainment provided by the employer for the benefit of the employee taxable to the employee? Is this simply 100% deductible for the employer, no one is taxed

[mjeanes]

I want to know if meals and entertainment provided by the employer for the benefit of the employee taxable to anyone.  I've read that it's 100% deductible for the employer, but is the employee taxed?   Can someone provide exact IRS publication to support their answer? Ex 463 under the exception section??    

[KittyM · Accepted solution]

Maybe.  In BOYD GAMING CORP., the Ninth Circuit Court ruled that on-site meals an employer provides to employees that meet the IRC (Internal Revenue Code) Section 119 “for the convenience of the employer” test are 100% deductible.  This business expense is not taxable to the employee, either, making it a good deal for both of you.

Some Meal & Entertainment expenses are not subject to the 50% limit, including expenses that are:

• Primarily for the benefit of employees who are not highly compensated.
• Directly related to business meetings.
• Included in an employee’s moving expenses that are paid or reimbursed by the employer.
• For meals that are excludable from an employee’s gross income as a de minimis fringe benefit.