Which of the following is a true statement?
A)Meals are never deductible as a business expense.
B)An employer can only deduct half of any meals provided to employees as compensation.
C)The cost of business meals must be reasonable.
D)A taxpayer can only deduct a meal for a client if business is discussed during the meal.
E)None of the choices are true.

Question

Quizplus · Accepted Answer

According to IRS regulations, the cost of business meals must be reasonable in order to be deductible as a business expense. Option A is false because some meals can be deductible if they are deemed necessary and reasonable for conducting business. Option B is incorrect because an employer can deduct 100% of the cost of meals provided to employees if they are for the convenience of the employer. Option D is incorrect because a meal can still be deductible even if business is not discussed as long as it is directly related to the taxpayer's trade or business.

Which of the Following Is a True Statement