Travel & Entertainment

Generally, the IRS requires 2 types of records for substantiation. You should maintain a diary (calender diary recommended)or account book to list the place, time, who you met with, and the business purpose of your travel and entertainment. Receipts, itemized bills or similar statements for lodging are needed regardless of the amount.For other expenses of $75 or more a receipt is needed. A bill should show the amount of the expense, the date of the expense, where the expense was incurred and the nature of the expense.

Costs incurred in entertaining customers, prospective customers, clients, suppliers, employees and other business associates are valid business expenses that are subject to conditions and restrictions.
For entertainment costs to be deductible, the following must be documented; the time, place and the nature of the entertainment, a description of the business purpose involved, the amount of each separate expense, the business relationship and identification of the persons entertained.
A calendar diary is recommended to maintain this information.

Beginning on Jan. 1, 2012, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be 23 cents per mile driven for moving purposes.

Generally, the deduction for business gifts is limited to $25 a year for each recipient if the gift is made to an individual.
There is no dollar limit on the deductibility of a business gift made to a corporation, partnership or business entity. Gifts to a corporation or other business entity intended for the eventual use or benefit of an owner, shareholder or employee is subject to the $25 limitation.

You may not deduct the cost of renting, maintaining or operating facilities to entertain. Examples of facilities would include yachts, boats, lodges, fishing camps, apartments, hotel suites or homes in a vacation area. The no-deduction rule applies to rent, depreciation, maintenance and operating expenses. It does not apply to the food and beverage costs incurred when entertaining in the facility.

You cannot deduct parking at your regular place of work because it's considered a commuting expense. Parking and other transportation expenses are often deductible, even by employees, if you work at more than one location in one day or work on a temporary basis away from your regular workplace.

While 100% is reportable, only 50% of meals and entertainment are deductible on your business expense forms. • Be sure to keep good records on who was present, the dates and times, and the reasons for the entertainment and business discussions that took place. You may not deduct costs of meals and entertainment for personal reasons while traveling. If the trip is "primarily" business, most expenses will be considered as business expenses. If the trip is "primarily" personal and you conduct some minimal business, only those costs directly related to the business you conduct may be deductible.

The depreciation year classification of a car used for business is 5 year property (5 year useful life)for MACRS depreciation purposes.

No. There is a 50% cost limitation on meals and entertainment that include skyboxes. Also, if the rental is for more than 1 game, you are only allowed to deduct the face value cost of the non-luxury box seats for the number of seats in the box as the deductible amount. The deduction would be claimed on IRS Schedule C or Form 2106.