The 2018 federal tax law changes have made tracking business and employee meals & entertainment expenses separately in your accounting system even more important. The biggest change from 2017 is that business entertainment (such as tickets to sporting events) are no longer deductible business expenses.
With our clients we recommend setting up 3 different subaccounts under Meals & Entertainment:
Business Meals (50% deductible)
Business Entertainment (0% deductible)
Employee Meals & Events (100% deductible)
Starting to track your meals and entertainment expenses this way now will make the next tax season much easier for you and your tax accountant.
If you have any questions or need help setting up your accounting correctly, please reach out to us at hello@edgebusinessplanning.com. - Your friends at EDGe Business Planning