July 26, 2018
One really nice one that that took a 50-percent hit was the "supper money" deduction. What is that? It's the fringe benefit that lets you provide your employees (and yourself!) with tax-free meal money when you're working late.
Before tax reform, you deducted 100 percent of the supper money cost. After tax reform, your tax deduction for supper money is subject to a 50 percent cut for amounts paid after 2017 and before 2026.
And this gets worse. For supper money costs incurred after January 1, 2026, your supper money tax deduction is zero.
For now, let’s look at your deductions for tax years 2018 through 2025 and how you make the supper money rules work for your employees and you. Yes, you!
As a business owner, you’re an employee eligible for supper money.
That's right. If you know how to follow the four rules that govern the super-money deduction, you can write off half of the cost of dinner.
Four rules you need to know now:
Rule #1: Make sure your dinners are "occasional."
Rule #2: Keep the cost of meals "reasonable." Uncle Sam doesn't specify a dollar limit on spending, but don't splurge when it isn't appropriate.
Rule #3: Be sure you're working overtime before you dig in. The IRS requires that the meal allowance must enable your employees to work overtime. (You can come out a winner too!)
Rule #4: Don't calculate the cost of the meal based on the number of hours your employees work. For example, you can't give a $20 allowance per hour of overtime. Instead, provide a reasonable discretionary meal allowance.
This tax season is an important one for many business owners because it’s the first that will be impacted by the Tax Cuts and Jobs Act (TCJA). How big of an impact is dependent on your unique situation. We’ve compiled this short list of provisions that may affect the business community:
According to Forbes.com, Super Bowl viewers traditionally load up on millions of pounds of less-than-healthy foods during the big game—including ribs, pulled pork, tortilla chips, nuts, popcorn and bacon—all washed down with beer (the Super Bowl beverage of choice). If you are trying to stick to your New Year’s resolution to eat better, consider a few healthy substitutes for the traditional Super Bowl eats:
The combination of running a business and your life and preparing for tax time can drive some people into a slight panic. But no need to get stressed if you are prepared. Now is the time to start organizing all documents required to file your tax return.