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When is as business dinner given for multiple clients 100% tax deductible?
After selling my business, I held a hosted business dinner for primary multiple clients as a "thank you for their business" and to introduce the new owners. There were 50 attendees (all clients or new owner's personnel).
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2 Answers
It is never 100% deductible. It is 50% deductible
Unfortunately, only 50% of the cost of entertaining business clients is deductible. There are very few exceptions to this rule.
Two exceptions that would allow 100% deduction are 1) De Minimis employer-provided fringe benefits, and 2) reimbursed expenses to the extent a company incurs the expense and is reimbursed by a client (with a full accounting of the expenses provided to the client). In the latter case, the client would only be able to deduct 50%, but the company would deduct 100%.
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