The IRS has provided guidance on tax relief for a tax deduction for food or beverages from restaurants. The Taxpayer Certainty and Disaster Tax Relief Act of 2020 added a temporary exception to the 50% limit on the amount that businesses may deduct for food or beverages.
Tax Deduction for Foods & Beverages
The temporary exception allows a 100% deduction from January 1, 2021 through December 31, 2022 for food or beverages from restaurants as long as the business owner (or an employee of the business) is present when food or beverages are provided and the expense is not lavish or extravagant under the circumstances.
Under the temporary provision, restaurants include businesses that prepare and sell food or beverages to retail customers for immediate on-premises and/or off-premises consumption.
Restaurants Will Benefit
However, restaurants do not include businesses that primarily sell pre-packaged goods not for immediate consumption, such as grocery stores and convenience stores.
Akram team can help you to get full business meals deduction
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