Question: What is %50 deductible and what is not?
I am preparing my taxes. i am a self emplyed; and have a lot of coffee while in the street in between projects, often lunch and even dinner when i finish to work very late after meetings.
Is that consider %100 deductible meals or %50?Please help
Answer: Meals are deductible only if 1) it is necessary for you to stop for substantial sleep or rest to properly perform your duties while away from home on business, or 2) the meal is business-related entertainment. Both of these categories are subject to a 50% deduction limit.
Your own meals while not away from home on business (in between projects, at lunch and dinner when you work late after meetings), are personal expenses and not deductible at all. Away from home generally means traveling at least overnight on a business trip. And in order for meals to be buiness-related entertainment, you have to entertain someone else and document the person, the date, the purpose for the entertainment, etc.
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