Business trips are a necessary part of many jobs and can be beneficial for businesses. However, the cost of such trips can add up quickly, especially when it comes to meals. Are meals during business travel deductible?
Eligibility for Meal Deduction
The Internal Revenue Service (IRS) allows taxpayers to deduct certain meal expenses on their taxes if they are incurred while traveling for business. The meal must be “ordinary and necessary” in order to qualify for the deduction.
This means that the meal must be appropriate and helpful in carrying out the business purpose of the trip. Additionally, only 50 percent of the cost of the meal is deductible.
Types of Business Travel
The IRS distinguishes between three types of business travel: local travel, away-from-home travel, and foreign travel. For local travel, any meal expenses incurred while on a business trip are eligible for deduction.
For away-from-home travel, meals are still deductible as long as they are ordinary and necessary expenses related to carrying out the business purpose of the trip. For foreign travel, any meals that would normally be considered ordinary and necessary are eligible for deduction.
Documenting Meals During Business Travel
In order to deduct any meals during business trips from taxes, taxpayers must keep proper documentation. This includes receipts from restaurants or other establishments where food was purchased as well as records about why the food was purchased. Additionally, taxpayers should keep records about how much time was spent eating and what business activities were conducted during those times.
Limitations on Meal Deduction
In addition to meeting all other requirements, meals during business trips cannot exceed certain limitations in order to qualify for a tax deduction. These limitations vary depending on where the trip was taken and what type of trip it was (local vs away from home). Additionally, there may be restrictions depending on whether or not lodging was provided by an employer during the trip. In general, taxpayers should keep track of their meal expenses throughout their trip so that they can accurately calculate how much is eligible for deduction.
Meals during business travels may be eligible for a tax deduction if they meet certain criteria set by the Internal Revenue Service (IRS). In order to deduct these expenses from taxes though, taxpayers must provide proper documentation including receipts from restaurants or other establishments where food was purchased. Are Meals During Business Travel Deductible? Yes – but only under certain conditions set by IRS regulations and documented correctly with receipts and records about why food was purchased and time spent eating related to business activities undertaken during your travels.