Maximizing Travel, Entertainment, and Meal Deductions: Meals after the OBBBA, Documentation, Local Travel vs. Away From Home

Businesses frequently incur expenses for travel, meals, and entertainment, and these expenditures can provide lucrative tax deductions. The rules surrounding these deductions are complex. Most recently, the OBBBA has disallowed deductions for employer-provided meals with certain narrow exceptions. Meal expenses, for others, however, are deductible at 100%, 80%, 50%, or 0%, depending on the nature of the expenditure.

To claim these deductions, a taxpayer must retain documentation that includes the name and location of the expenditure, the date, the attendees, the business purpose of the expense, and a receipt or invoice. All expenses must be ordinary and necessary to be deductible. Even with appropriate support, choosing between the standard mileage rate, actual expenses, and applicable per diem rates can be problematic. Taxpayers and their advisers need to understand the rules for deducting travel, meals, and entertainment expenses to maximize these deductions.

Listen as our panel of federal income tax experts reviews the rules and recordkeeping requirements for travel, meals, and entertainment to ensure taxpayers receive the maximum deductions they are entitled to for these expenses.

I.                   Travel, meal, and entertainment expenses: introduction

II.                 Travel

A.    Local transportation

B.    Away from home

C.   Written requirement

III. Meals after the OBBBA

IV.   Automobile expenses

A.    Mileage

B.    Actual costs

C.   Form 4562, Depreciation and Amortization

V.              Entertainment

VI.              Recordkeeping

VII.            The Cohan Rule

VIII.          Per diem payments

A.    Allowances

B.    Standard per diem rates

IX.              Recent cases and rulings

The panel will cover these and other critical issues:

• OBBBA's disallowance of the deduction for employer-provided meals
• Applying the appropriate percentage when deducting meal expenses
• When IRS per diem rates should be utilized for out-of-town lodging, meals, and incidental expenses
• Understanding the written requirements for travel deductions
• Recent cases and rulings regarding deductions for travel, entertainment, and meals

Learning Objectives

After completing this course, you will be able to:

• Identify the requirements for deducting meal expenditures
• Determine required documentation for travel deductions
• Decide when IRS per diem rates for lodging, meals, and incidental expenses should be considered
• Ascertain changes made to entertainment deductions by tax legislation

• Field of Study: Taxes
• Level of Knowledge:
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite:

  Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of individual income taxation, including itemized deductions, individual income tax credits, net operating loss limitations including carrybacks and carryforwards.

  
  

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IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).