Meals and Entertainment Deductions Under the New Rules

The IRS has just issued guidance on meal and entertainment expenses in Notice 2018-76. Client business meals are 50% deductible if business is conducted, taxpayer is present, and it is not lavish or extravagant. Meals during business travel, meals in the office for employee meetings, and meals provided occasionally to employees are 50% deductible. There are no deductions for sporting event tickets or club memberships. Water, snacks, and coffee provided to employees is now only 50% deductible. Office holiday parties and picnics are 100% deductible.