In a 2018 blog post, I interviewed Steve Hoffman, a tax preparer and food writer, about tax issues, freelancing, and how the new tax law might affect people in our industry. Of most concern was whether we food writers could still write off business meals.
First there was bad news, but now there’s good news. Steve said he didn’t think the IRS would let us write off business meals anymore. But later in the year, the Internal Revenue Service (IRS) clarified the new law, to our advantage.
Here’s how Steve puts it: “The new tax law eliminated any deductions for entertainment, which most tax preparers originally interpreted to mean both meals and entertainment. Under the prior law, sole proprietors and small businesses could deduct 50% of the cost of business related meals (such as restaurants, bars, and cafes) and entertainment (such as theater and sporting events). Most of us preparers thought businesses and self-employed people had lost all of those deductions with the arrival of this new law.”
“In August, however, the IRS issued some new rulings and procedures, and it now appears that, while entertainment is still eliminated as a deduction, business related meals are allowed.”
So, fabulous, right? Keep this in mind, though. Steve says those meals must still have a clear business purpose. Typical examples might include:
- Taking a client to lunch to discuss future projects
- Meeting with a colleague who gives you advice on how to up your social media game
- Meeting over a meal to interview a chef for a story
- Meals while travelling for business purposes, such as attending a conference or class directly related to your business
- Eating 20 kinds of pie at restaurants for a pie cookbook you are under contract to write.
I hope you kept those 2018 receipts or credit card statements. And that you documented those meals in your 2018 planner or calendar. The key word is “substantiation,” says Steve. That’s what the IRS likes.
“All in all this is good news for our profession, which is so dependent on eating, dining, food, drink, and hospitality,” he concludes.
* * *
(Canadian readers, please read this blog post from the Food Bloggers of Canada about what food bloggers can expense.)
* * *
In other news: If you subscribe to my blog posts by email, you might have noticed that your email looked slightly different. I’m using a new service. If you like it better or you’re having any problems with delivery, please let me know. Email me at dj AT diannej DOT com.
(Photo by Jay Wennington on Unsplash.)