Can i write off promotional giveaways of merchandise?

[Debra_H · Accepted solution]

Hi B.,

You can deduct the cost of promotional giveaways in your advertising expenses if you provide promotional gifts to a broad audience of potential clients or customers, not for individually identified persons.  The cost of a promotional gift distributed in this way is 100 percent deductible.

• Technically, there is no IRS limitation on the number of gifts a particular potential client or customer receives during the course of any given year. Additionally, there is no set limit on the total cost of a promotional gift provided through this type of marketing program as far as an IRS deduction is concerned. (An example of this type of promotional gift program is a $100 gift certificate for a consumer who test drives an auto at a dealership.)

I hope this helps to clarify your situation.  If you have additional questions or comments, please feel free to reply to this post. 

Thanks for trusting TurboTax with your tax preparation.

Debra 

[Darliene]

How do you do list that? I listed the inventory (which indicated the reduction in inventory for the promotional gifts). If I then list it as an expense for Advertising and Promotions, that doubles the amount deducted from the net gain/loss.

[bigcat15]

did you get answer. If the certificate is only good for your business only its cogs