Deductibility of Meals Provided to Employees

If you are an employer who provides meals for your workers, you may be able to deduct some or all of the cost of the meals. Generally, you are limited to a deduction of only 50 percent of the cost of those meals. However, under certain circumstances, you may be able to deduct the entire cost.

You can deduct the full cost of meals provided to your employees under the following circumstances:

  • You included the value of those meals in the reported wages of your employees.
  • The meals qualify as a de minimus fringe benefit. In other words, they were provided at your place of business and more than half of the employees received the meals at your convenience.
  • You operate a restaurant or catering business, and you furnished the meals to your employees at the work site.
  • You provided the meals as part of the expense of offering recreational or social activities to your employees.
  • You were required under federal law to furnish the meals to crew members of certain commercial vessels. However, this exception to the 50 percent limitation does not include meals furnished on vessels primarily providing luxury water transportation.
  • The meals were provided on an oil or gas platform or drilling rig located offshore or in Alaska, including meals furnished at a support camp that was near and integral to an oil or gas drilling rig located in Alaska.

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