The National Directory of Certified Public Accountants

Ask A CPA - Business Start-ups

When Are Business Meals And Entertainment Expenses Deductible ?

Generally, meal or entertainment expenses will be deductible with certain limitations as long as the meal or entertainment expenses are "directly related to" or "associated with" the active conduct of your trade or business and they are not extravagant or lavish under the circumstances. Deductions are generally limited to 50% of the cost. Detailed recordkeeping should be kept to verify the deductions. Entertainment includes activities such as entertainment at nightclubs, cocktail lounges, theaters, golf and athletic clubs, country clubs, sporting events.

If you need professional help with "Business Start-ups" or have other tax questions, we can help you find a local licensed CPA for a free, no-obligation consultation.