Rob Rowsell’s personal CPA shares a key Real Estate Investor Tax Strategy: write off meals, conferences and events, and sponsorships. Learn how to write off each of these deductions to get the most returns while avoiding a costly IRS audit.
Write Off Meals, Conference Events, and Sponsorships
Kevin opens up, introducing the term “pre-taxing your lifestyle”. When you start a business or begin investing, you can start deducting things you were already spending money on. First, he breaks down the rules for us to write off meals. Business meals are 50% deductible. This is down from the 100% deductions we were able to take during Covid. Overtime meals, or OT meals, are 100% deductible.
What about Entertainment expenses? Sadly, we can’t write off any expenses like concert tickets or golf games. However, when that entertainment is part of a corporate function, it is 100% deductible. A corporate function means that you are paying for your entire team to participate.
What about ways we can write off meals completely? Corporate functions can include company picnics or snacks you buy for the office to share in their break room. Also, the aforementioned overtime meals, such as a pizza to feed more than half of your staff working late, count.
Another way to write off meals includes promotional food provided to the public. Also, you can write off food reimbursed from customers you pay for on a consulting trip.
When You Can Write Off Meals 50%
You may deduct half of your food expense for business meetings with less than half of your employees. Owners’ meetings and meals with customers and vendors also qualify. When you buy meals on business travel, including seminars, out of pocket, you can deduct 50%.
Write-Offs For Corporate Events And Sponsorships
If you treat a customer to a sporting event, you sadly can’t write it off. However, if you take your whole staff to a game, you may deduct 100%. If you pay for a round of golf with a client, it’s a 0% deduction. But let’s say you sponsor an entire golf tournament! Whether it’s a charity game or just a regular sponsorship to get your name out there, it is 100% deductible. Now, that’s thinking big!
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