Reminder that the deductibility of business meals has changed for 2021 and 2022. Food and beverages will be 100% deductible if purchased from a restaurant during 2021 and 2022. The temporary 100% deduction should help restaurants which have been hard hit by the pandemic. Below is a chart you may find helpful as you monitor these expenses. Entertainment continues to be 100% nondeductible.
The Biden Administration’s American Families Plan and other tax proposals may complicate the tax landscape for high-income earners. Many of the proposals target taxpayers earning more than $400,000 per year.
The IRSand the Treasury released guidance Thursday April 8, 2021 on a temporary exception to the 50% limit that businesses can deduct for food or beverages from restaurants during the pandemic.
On Wednesday of last week, the IRS issued long awaited guidance clarifying that taxpayers may generally continue to deduct 50% of the food and beverage expenses associated with operating their trade or business, despite changes to the meal and entertainment expense deduction under the Tax Cuts and Jobs Act.