Tax · 6 min read
Meals and Travel Deduction Guide
Meals and travel are legitimate, sizeable deductions when there's a clear business purpose and the documentation actually exists. Sloppy notes are the #1 reason these get knocked out in an audit.
Business meals — the 50% rule
- Meal with a client, prospect, vendor, or employee with a business purpose
- Owner is present and the cost is reasonable (not lavish)
- Deduct 50% of the cost
- Document: date, amount, attendees, business purpose
What's still 100% deductible
- Meals provided at company-wide events (holiday party, summer outing)
- Meals included in the price of a conference or seminar registration
- Meals provided to the public for promotional purposes
Business travel — the away-from-home test
Travel deductions require being away from your tax home substantially longer than an ordinary workday, with a real business purpose. Day trips don't qualify for lodging or per diem; overnight trips do.
- Airfare, train, rental car, rideshare to/from the destination
- Lodging at the destination
- 50% of meals while away
- Tips, parking, baggage, business calls, dry cleaning
