How Much Can I Deduct for Meals on My Taxes?

The Internal Revenue Service (IRS) provides specific guidelines that determine when and how much of a meal expense can be deducted. Navigating these rules requires attention to detail, from establishing the business purpose of a meal to maintaining accurate records.

Determining Deductible Meals

For a meal to be considered deductible for tax purposes, it must meet certain criteria established by the IRS. The expense must be considered “ordinary and necessary” for your trade or business. An ordinary expense is common and accepted in your industry, while a necessary expense is helpful and appropriate for your business. The meal should not be lavish or extravagant under the circumstances.

The meal must also be directly related to, or associated with, the active conduct of your business. This generally means that business is discussed during the meal or immediately before or after it. You, or an employee of your business, must be present at the meal.

Qualifying scenarios include meals with clients, customers, or business associates where a substantial business discussion occurs. Meals incurred while traveling away from your tax home on business are also typically deductible.

Applying Deduction Limits

Most business meals are subject to a 50% deduction limit. This rule applies to common situations such as meals with clients where business is discussed or meals consumed while traveling for work. For instance, if a business meal costs $100, generally only $50 can be deducted.

There are specific exceptions that allow for a 100% deduction. Meals provided for the convenience of the employer, such as those offered on-premises to enable employees to work an extended workday, can be 100% deductible. This also includes de minimis fringe benefits, like occasional snacks or coffee provided to employees.

Meals included as part of recreational or social activities primarily for the benefit of employees, such as holiday parties or annual company picnics, are also 100% deductible. Additionally, meals sold to customers in the course of the taxpayer’s trade or business, for example by a restaurant, can be fully deductible. When an employer reimburses an employee for meals under an accountable plan, the employer can deduct 100% of the reimbursed amount, although the underlying meal may be subject to the 50% limit at the employee level if they were paying for it personally.

Certain meals are not deductible at all. The Tax Cuts and Jobs Act (TCJA) generally eliminated deductions for entertainment expenses, including tickets to sporting events or golf outings. While meals provided during an entertainment activity might still be 50% deductible, the cost of the meal must be purchased separately or stated separately on the invoice from the entertainment. Personal meals that do not have a clear business purpose are never deductible.

Essential Recordkeeping for Meal Deductions

Accurate recordkeeping is fundamental for substantiating meal deductions to the IRS. Taxpayers must maintain detailed records to prove the legitimacy of each expense. This documentation should include the amount of the expense.

Records must also clearly indicate the time and place where the meal occurred. This typically involves noting the date of the meal and the name and location of the establishment. The business purpose of the meal is another crucial element, requiring a description of the business discussion or activity that took place.

Furthermore, the business relationship of the person(s) entertained or attending the meal to the taxpayer must be recorded. For expenses over a certain amount, such as $75, receipts are generally required, but it is a good practice to keep receipts for all deductible meals regardless of the amount. Maintaining a logbook, using digital apps, or keeping physical receipts are common methods for organizing these records.

Claiming Meal Deductions

Once qualified meal expenses are identified and properly documented, they must be reported on your tax return. Self-employed individuals, including sole proprietors and those filing Schedule C, report their deductible meal expenses on this form. The total qualified amount is entered on the appropriate line.

For employees, unreimbursed business expenses, including meals, were largely suspended as miscellaneous itemized deductions by the Tax Cuts and Jobs Act through 2025. However, certain categories of employees, such as qualified performing artists or fee-basis government officials, may still be able to deduct these expenses on Form 2106. This form is used to calculate and report various employee business expenses, including the deductible portion of meals.

Accurate classification and entry of these expenses are important to ensure compliance with tax regulations. Taxpayers should ensure that only the allowed percentage of the meal expense is included in their deductions.