1. Code: 119(a), 162(a),262, 274(n)
2. Reg: 1.162-17(a)
3. Sharply distinguish this from meals we’ve already considered. That delicious AA dinner on your flight to Cincinnati when you’re in travel status is a travel expense, not a “business meal.” A “business meal” is what you have when you’re at home in Dallas. You’re not claiming you’re away from home; you’re claiming that you have to eat the meal for business purposes.
4. Requirements for the Deduction:
a. Sutter v. Commissioner (1953)
i. You can deduct the amount that is “different from or in excess of” the amount you would normally spend. If you typically go to McDonald’s for lunch but have to go to Louie’s 106 for business purposes, you can deduct the entire cost of the lunch at Louie’s (not just the difference b/t the McDonald’s cost and the Louie’s cost). But note: you’re only taking 50% of that entire cost. 274(n).
b. Moss v. Commissioner (1985)
i. 119: excludes meals provided for the employer’s convenience, however, they must be on the employer’s premises, t/f no dice
ii. 162(a): allows all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business, but it must be while away from home, t/f no dice
iii. Even assuming it was necessary for Moss’s firm to meet daily to coordinate the work of the firm and lunch was the most convenient time, it doesn’t follow that the expense of the lunch was a necessary business expense. The members of the firm had to eat somewhere, and the place they picked was close by and cheap. They don’t claim that they incurred any greater expense than they normally would have had there been no lunch meetings. The situation might have been different if circumstances were such that they had to eat at a disagreeable restaurant or one that was vastly more expensive than what they normally would have selected.
5. Amount of the Deduction:
a. 274(n): only 50% is deductible
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