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When are business meals fully deductible?

Posted on January 7th, 2021

With the passage of the latest COVID Relief Bill, there were some changes to the business meals expense deduction for 2021 and 2022. Here’s some clarification on how you can take a 100% deduction:

Meals served at social or recreational events for employee benefit (Zoom counts!). To clarify, these gatherings cannot only benefit highly compensated employees.

Food given to the public for free, usually for business promotional purposes is fully deductible.

Food and beverage provided in OR by a restaurant counts. That means you can dine-in, get delivery, or take-out with current (or prospective) business associates. Business associates can be customers, suppliers, employees, partners, or business advisors.

As usual, meals should still be reasonable under the circumstances and an employer or employee must be present.

Entertainment is still a non-deductible business expense.


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