What is the difference between "meals" vs. "meals for clients"?

Meals could be travel meals for business or meals for employees.

 

Instead of keeping records of your meal expenses and deducting the actual cost, you can generally use a standard meal allowance, which varies depending on where you travel. The deduction for business meals is generally limited to 50% of the unreimbursed cost.

 

Employer-Provided Meals. Employer-provided meals are tax-free to the employee. They're also 50% deductible if they're provided on the premises of the employer and are offered for the convenience of the employer.

 

"Meals for clients" is stricter now that there are no more allowances for entertainment.

 

Food and beverages that are provided during entertainment events are not considered entertainment if purchased separately from the entertainment, or if the cost of the food and beverages is stated separately from the cost of the entertainment on one or more bills, invoices, or receipts. However, the entertainment disallowance rule may not be circumvented through inflating the amount charged for food and beverages.

Where do I deduct 'meals with clients'?

Please follow the steps below to input meals with clients:

 

1. Press on Tax Home from the Left Menu
2. Click on Income & Expenses on the main screen and click on Work on other income
3. Scroll Down and you will see a section for "Self - Employment", expand that section and press Start/Revisit
4. If you have a business already showing up there, you will press Review or you will get get a series of questions which you will have to answer
5. Once you answer all the informational questions, you will get a section to enter all your expenses ( see image below ). Scroll down and you will see a section for Meals and you can click on Add and enter your expenses accordingly

Keep in mind for tax years 2021 and 2022, depending on the type of meal deduction you can either get a 50% or 100% Deduction.

 

To be considered for 100% deduction, one of the following events should occur:

 

• Company parties
• Food made available to the public for free
• Meals for children at daycare facility
• For tax years 2021 and 2022, business meals if food and beverages were purchased at a restaurant.
• Other meals 100% limit expenses