Meals and entertainment expense deductions can be confusing — especially when rules and guidance change.
The Consolidated Appropriations Act, signed into law on December 27, 2020, temporarily changed the deductibility of meals to help give the restaurant industry a boost. It made qualified business meals purchased from a restaurant in 2021 and 2022 100% deductible.
However, the temporary deduction ended with the Tax Cuts and Jobs Act. Restaurant expenses made in 2023 and beyond are once again subject to the 50% limit on deductibility.
Use this chart to keep track of meals and entertainment rule changes from 2022 to 2023.
For a checklist of 2024 business meals, entertainment and travel deductibility, go here.
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Meals and entertainment comparison chart* |
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2022 treatment |
2023 treatment |
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Client business meals |
100% deductible (if provided by a restaurant) otherwise, 50% deductible Taxpayer present Not lavish or extravagant |
50% deductible Taxpayer present Not lavish or extravagant |
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Office holiday party or picnic |
100% deductible |
100% deductible |
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Sporting event tickets |
No deduction |
No deduction |
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Meals during entertainment events |
50% deductible (if purchased separately or stated separately) |
50% deductible (if purchased separately or stated separately) |
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Transportation to/from restaurant for business meals |
100% deductible |
100% deductible |
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Club dues |
No deduction |
No deduction |
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Water, coffee and snacks at the office |
50% deductible, nondeductible after 2025 |
50% deductible, nondeductible after 2025 |
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Meals in the office during meetings of employees, stockholders, agents or directors |
50% deductible |
50% deductible |
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Meals during business travel |
50% deductible |
50% deductible |
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Meals at a seminar, conference or business league event |
50% deductible |
50% deductible |
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Meals included in charitable sports packages |
100% deductible |
50% deductible |
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Meals provided for the convenience of employer, provided occasionally to employees or overtime meals |
50% deductible, nondeductible after 2025 |
50% deductible, nondeductible after 2025 |
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Meals included as taxable compensation |
100% deductible |
100% deductible |
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Meals expenses sold to a client or customer (i.e., reimbursed) |
100% deductible |
100% deductible |
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Food offered to the public for free (e.g., at a conference or seminar) |
100% deductible |
100% deductible |
Our tax and audit specialists stay on top of meals and entertainment deductions — and other ways to minimize your tax exposure and meet your financial goals. We take a proactive and comprehensive approach to tax planning and create robust solutions around opportunities. To learn more, contact us today.
Related reading:
- New IRS pre-filing registration portal for tax credits
- Tax planning moves before year-end — and all year round
- Get set for new Corporate Transparency Act reporting requirements
* This chart is for general guidance only. It is not a substitute for consultation with your tax advisor. Deductibility of expenses requires careful consideration of the facts and law. This chart is based on the tax law in effect as of January 2023. Wipfli LLP does not undertake any obligation to update the chart for subsequent changes to the law.