As a consultant, meal expenses which were reimbursed were included with my fees in my 1099-MISC. How do I classify them as deductions to get them out of income?

[mnbnd2]

As a consultant, I submitted meal expenses during business travel to my client, which were reimbursed. However, the amounts of all my business expenses: flights, hotels, meals, etc., all of which were reimbursed, were included with my fees on the 1099-MISC.

I understand how to carve out the flights and hotel expenses. However, how do I classify meals as deductions to avoid paying income taxes on these reimbursed expenses?  TT seems to want to classify them as having a 50% limit.

[MinhT · Accepted solution]

The IRS has ruled that in the case whether a client reimburses a contractor his meal expense, only one party (either the client or the contractor) shall bear the 50% limit.

Who shall bear that 50% limit depends on whether you account for the meals (i.e. provide receipts or other justification) to your client. If you account for the meals, then the client bears the 50% limit. If you fail to account for the meals, then you bear the 50% limit.

Please read this article for more information:

http://www.bizfilings.com/toolkit/news/tax-info/meal-expenses-travel-deducting-50-percent-limit.aspx

To avoid the 50% limit in TurboTax, you list the expense under Meals and Entertainment: 100% Limit.