Tax expert Roni Lynn Deutch has written an article for WomenEntrepreneur.com explaining how businesses can get tax deductions for throwing company holiday parties and giving holiday gifts to their employees.
“The cost of throwing parties for your employees is 100 percent deductible,” Deutch writes in the article. “The food, the beverages, the decorations — all those expenses can be deducted. The only caveats: The expenses must not be overly extravagant (e.g., champagne, caviar and lobster for a holiday luncheon), and the parties must be infrequent (weekly parties are likely to raise an eyebrow or two at the IRS and could invite an audit).”
The gifts a company owner gives his or her employees can also be written off, according to Deutch.
“The key here is to keep the value of these gifts in a reasonable range or, as the IRS says, ‘of nominal value.’ Doing so allows you to give these gifts and claim deductions for non-wage work business expenses,” she writes. “Even better, these ‘de minimis’ gifts are not subject to the standard 50-percent deduction limit that usually applies to meal and entertainment expenses.”
To get all of Deutch’s holiday tax tips, read the complete story here.