Written by attorney Henry Daniel Lively

How to document Business Meals For Tax Purposes

It is no secret that the IRS likes to audit the business meals that you claim on your tax return. Your best defense to this situation is to adequately document your position. The Internal Revenue Code only allows for a 50 percent deduction of Business Meals.

To be deductible the meal must meet the ordinary and necessary hurdle that all business expenses must meet and this is not the subject of this legal guide. The purpose of this legal guide is to instruct you on how to keep your records after you have already met the ordinary and necessary test so that your legitimate meal expense will be sustained on audit if necessary.

When you have a business meal you can use the actual receipt to document the meal. On the back of the receipt indicate who you had dinner with and what the business purpose of the meal was by documenting the business discussion you had immediately before, during, or after the meal. If multiple parties were present document all of their names. Put this receipt in cronological order in a file by year. Then if you ever have to explain the business purpose of the meal you have it fully documented.

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