The IRS has specific rules for deducting business meals for independent contractors looking to take advantage of their business lunches. For one, deductible meals have to be shared with an associate. A solo meal doesn’t count, even if you’re the only employee of your business.
You can use IRS Publication 535 as a guide when deducting business expenses. The second condition to claim the meals deduction in 2024 is that you have to discuss business matters during the meal.
While this may seem obvious, you can’t deduct a meal just because you ran into your client at a bar and decided to catch up. The meal should have a clearly stated business purpose, whether you’re meeting up with new clients or chatting about current projects with existing ones.
The business meals deduction in 2024 isn’t limited to just clients, though. If you have a business meeting with any kind of business associate over a meal, you can write off half the cost. Business associates include:
- Employees
- Customers
- Partners
- Suppliers
- Agents
- Advisors
So, if you're a
freelance model and meet with your agent to discuss your upcoming gigs over a coffee or grab dinner with your lawyer to go over a new job contract, both instances count as a deductible expense.
To write off a meal, the cost must be considered an ordinary and necessary expense to your business. So, if going out for meetings with your clients or associates doesn’t make sense for your line of work, the IRS isn’t going to be too happy seeing it as a tax deduction.
You can also deduct business meals you have with your spouse if they’re related to your business in some way and your cause for the meal is work-related. If you and your partner have a company together, the cost of your business meetings over food is a legitimate tax deduction.
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1099 tax calculator can help you figure out which meals you can write off. Super fancy meals don’t really count as an ordinary expense, so they can’t be written off either. So you can forget about taking a client out for steak just to get a tax deduction– unless you have a valid reason. If the cost isn’t reasonable, you can safely assume that the business meal isn’t going to count.