The IRS recently proposed rules to clarify that taxpayers may generally continue to deduct 50% of the food and beverage expenses associated with operating their trade or business despite changes made under the Tax Cuts and Jobs Act (TCJA).
The proposed rules generally follow Notice 2018-76 (PDF), and taxpayers may rely on its guidance until the final regulations. Under the proposed rules, taxpayers may deduct 50% of an otherwise allowable business meal expense that meets certain standards.
Sec. 274(k), which was not amended by the TCJA, does not allow a deduction for food or beverage expenses unless the expense is reasonably priced under the circumstances and the taxpayer (or an employee of the taxpayer) is present when receiving the food or beverages.
The IRS is requesting comments on all aspects of the regulations.