{"id":30247,"date":"2017-10-24T08:00:53","date_gmt":"2017-10-24T13:00:53","guid":{"rendered":"https:\/\/www.hrblock.com\/tax-center\/?post_type=newsroom&#038;p=30247"},"modified":"2023-03-01T13:29:19","modified_gmt":"2023-03-01T19:29:19","slug":"meals-entertainment-tax-deductible-business-trips","status":"publish","type":"newsroom","link":"https:\/\/www.hrblock.com\/tax-center\/newsroom\/small-business\/meals-entertainment-tax-deductible-business-trips\/","title":{"rendered":"Meals and entertainment \u2013 are they tax-deductible on business trips?"},"content":{"rendered":"<p>For many, business trips sound glamourous; a break from the daily grind and a new city to explore. The fact is that <a href=\"https:\/\/www.rita.dot.gov\/bts\/sites\/rita.dot.gov.bts\/files\/publications\/america_on_the_go\/us_business_travel\/html\/entire.html\">3 of 4 business trips are within 250 miles of the traveler\u2019s home<\/a>, which could mean a four-hour road trip for work. When business travelers are going to cities they would like to visit for leisure, seizing the <a href=\"https:\/\/www.hrblock.com\/tax-center\/newsroom\/small-business\/bleisure-travel-can-unpack-tax-breaks\/\">opportunity to mix business with pleasure<\/a> can be irresistible \u2013 and under the right circumstances a portion of their expenses could be tax-deductible.<\/p>\n<p>Being able to deduct eligible meal and entertainment expenses incurred while on a business trip requires taxpayers to determine if the meals and the entertainment are truly related to the business at hand. In order to be compliant with tax laws, business travelers need to make sure the expenses they deduct meet the eligibility thresholds.<\/p>\n<h2><strong>Eligible business travel expenses \u2013 when and who?<\/strong><\/h2>\n<p>Potentially eligible tax-deductible business travel expenses are ordinary and necessary costs of traveling away from home for a business, profession or job. Business travel expenses that could be tax-deductible include lodging, transportation and shipping.<\/p>\n<p>Generally, 50 percent of meal expenses can be deducted and 50 percent of expenses to entertain a client, customer or employee is deductible if the expenses are either directly related or associated with a clear business purpose.<\/p>\n<ul>\n<li>Are the expenses directly related to business?\n<ul>\n<li>The entertainment took place in a business setting OR<\/li>\n<li>The main purpose of the entertainment was so business could be conducted, and business was conducted, and there was the expectation business benefits would be the result<\/li>\n<\/ul>\n<\/li>\n<li>Are the expenses associated with business?\n<ul>\n<li>The entertainment is associated with the trade or business being conducted AND<\/li>\n<li>The entertainment occurred directly before or after a substantial business discussion<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p>For ordinary and necessary business expenses, there is no adjusted gross income limit to how much <a href=\"https:\/\/www.hrblock.com\/tax-center\/newsroom\/small-business\/small-business-owner-tax-questions\/\">small business owners<\/a> can deduct. However, employees face a different set of criteria; if not reimbursed by the employer, these <a href=\"https:\/\/www.hrblock.com\/tax-center\/filing\/adjustments-and-deductions\/unreimbursed-employee-expenses\/\">expenses can be claimed by employees<\/a> as <a href=\"https:\/\/www.hrblock.com\/tax-center\/filing\/adjustments-and-deductions\/miscellaneous-itemized-deductions\/\">miscellaneous itemized deductions<\/a>, which are deductible to the extent they exceed 2 percent of adjusted gross income. Taxpayers are reminded to make sure they have the appropriate <a href=\"https:\/\/www.hrblock.com\/tax-center\/newsroom\/filing\/accurate-financial-documents-key-to-smooth-tax-filing\/\">paperwork and receipts<\/a> when they claim any tax deductions.<\/p>\n<p>No matter who is spending the money, expenses that are not ordinary and necessary and within the days required for the business to be conducted, are not tax-deductible. Understanding how situations that seem similar can yield different opportunities for deducting expenses can help taxpayers claim all the deductions they are due.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>For many, business trips sound glamourous; a break from the daily grind and a new city to explore. The fact is that 3 of 4 business trips are within 250 miles of the traveler\u2019s home, which could mean a four-hour road trip for work. When business travelers are going to cities they would like to [&hellip;]<\/p>\n","protected":false},"author":418,"featured_media":26507,"menu_order":0,"template":"","tags":[],"news-categories":[23340],"class_list":["post-30247","newsroom","type-newsroom","status-publish","has-post-thumbnail","hentry","news-categories-small-business"],"acf":{"post_rest_thumbnail_alt_id":null},"yoast_head":"<title>Meals and entertainment on business trips | H&amp;R Block Newsroom<\/title>\n<meta name=\"description\" content=\"In order to be compliant with tax laws, business travelers need to make sure the expenses they deduct meet the eligibility thresholds and are tax deductible.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.hrblock.com\/tax-center\/newsroom\/small-business\/meals-entertainment-tax-deductible-business-trips\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" 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