Can I Write This Off?

Can freelancers deduct meals and entertainment irs?

TL;DR

Freelancers can generally deduct 50% of business-related meal expenses, but entertainment expenses are not deductible. It's important to distinguish between meals and entertainment to avoid errors.

Detailed Answer

Meals are deductible at 50% if they are directly related to or associated with the active conduct of a trade or business. This includes meals with clients, prospects, or business partners where business is discussed. Entertainment expenses, however, are not deductible under current tax law. For meals to qualify, the taxpayer or an employee must be present, and the expense must not be lavish or extravagant. Meals provided at an office or during business travel also qualify. It's crucial to separate meal costs from entertainment costs on receipts.

Where to Put It on the Tax Form

Schedule C, Line 24b for meals. Entertainment expenses are not deductible and should not be included.

Real World Example

A freelance graphic designer meets a potential client for lunch to discuss a new project. The total bill is $60. The designer can deduct $30 as a business expense (50% of the meal cost).

Calculation Required

A calculation is required for this deduction.

Calculate 50% of the total meal cost to determine the deductible amount. For example, if the meal cost is $100, the deductible portion is $50.

Audit Risk & Documentation Tips

Moderate audit risk. Keep detailed records, including receipts, the names of those present, the business purpose of the meal, and the date and location. Use a log or app to track these expenses consistently.

IRS Reference

IRS Publication 463, Travel, Gift, and Car Expenses; IRC §274.

Relevant Industries

FreelancersConsultantsSales ProfessionalsEvent Planners

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Disclaimer: This is for informational purposes only and should not be construed as tax or legal advice. Always consult your tax advisor.

Page created on July 15, 2025

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