Is your firm maximizing your meals and entertainment deductions?
Many firms leave money on the table—or risk IRS attention
INSIGHT ARTICLE |
Entertaining clients is a significant expense for professional services firms, yet many do not have sufficient policies in place to ensure they are maximizing their meals and entertainment deductions while controlling their audit risks. Some such expenses are 100 percent deductible, others only 50 percent. And what about the expenses spent on employees, such as for team outings? If you’re not capturing the right data, you could be missing out on deductions or leaving yourself exposed to unwanted attention from the IRS.
The following articles offer key insights into how to track, record and report the data you need to maximize your meals and entertainment deductions and also control your audit exposure.
There are exceptions to the 50 percent tax deduction rule related to meals and entertainment benefitting government contractors, some allowing up to 100 percent deduction.
Statistical sampling eases the burden of identifying eligible M&E expenses through three-year extrapolation of expenses.