Are business gifts deductible?

If you give a business gift in the course of your trade or business, you can deduct the cost subject to special limits and rules. Generally you cannot deduct more than $25 for business gifts that you give directly or indirectly to any one person during the tax year. Keep receipts for all gifts you give for business purposes. These receipts will help you to prove your deductions if you are ever audited. Track your business gifts throughout the year so you don't have to go through all of your receipts individually at tax time. You should record who the gift was given to, what that person's relationship is to your business and how much the gift cost.