Business Meals Set To Replace The Office

Business Meals

Imagine you are an estate planning attorney in Manhattan, NY. You no longer use your physical office space due to Covid-19, and clients don’t want to come to your office. You can meet clients at your favorite coffee shop, but you don’t think that provides the best client experience.

Enter the Consolidated Appropriations Act, 2021: A Little Background

After long negotiations and delay, the President signed the Consolidated Appropriations Act, 2021 on December 27, 2020. In an effort to shore up the dining industry, the relief legislation includes a temporary return of the business deduction for meals.

The deduction was originally reduced to 50 percent of the cost of meals more than thirty years ago. However, the Consolidated Appropriations Act, 2021, allows for businesses to deduct the full amount of meals, including beverages, provided at a restaurant. The deduction is allowed for amounts paid or incurred after December 31, 2020 through December 31, 2022.

So let’s go back to our attorney friend in Manhattan. She needs to meet clients and doesn’t have office space, she goes to a restaurant to meet her client, pays for the meal, and expense the full amount of the meal. Keep in mind, in order for you to take this deduction, it must be ordinary and necessary. In other words, there has to be a necessary business reason for the in-person meeting at the restaurant, and it must be ordinary in that it is generally accepted in your industry and or trade that such meetings take place.

If you look at the legislative intent of congress in passing this bill, you will see it was done to help the restaurant industry in the aftermath of the devastation it sustained due to COVID-19. I would venture to say that in the coming weeks and months, you will see restaurants start to market this to draw in business clients. No different than what we saw with certain car companies advertising tax-benefits on certain size vehicles a few years ago.

Before you go out there and start holding lunch meetings, discuss your situation with your CPA.

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Sev Meneshian, CFP®

Director of Financial Planning

Sev is a Certified Financial Planner® Practitioner and an adjunct professor of retirement planning at Northwestern University. His primary responsibilities are optimizing financial plans that align with the goals of our clients as their lives unfold and their needs evolve. He holds series 65 and is registered in CA, IL, IN, WI.

Ara Bayindiryan, CIS™, CEPA®

Chief Investment Officer

Ara is the Chief Investment Officer responsible for the overall management of our client investment portfolios. In addition, Ara’s expertise in the area of exit-planning helps our business-owner clients create an exit plan that helps maximize the benefits they receive from their enterprise. He holds series 65 and is registered in TX, CA, IL, IN, WI. CA insurance producer # 0L96506

Avo Mavilian, EA, WMCP®, ChSNC®

President, Founder, & Chief Strategist

Avo Mavilian focuses his practice in the areas of wealth preservation & tax planning.

He works with successful professionals, families and executives of privately owned companies to design and implement wealth preservation & tax planning strategies.  He frequently collaborates with business and estate planning attorneys, utilizing their knowledge and experience to best serve the needs of his clients.

Avo’s advisory work extends to helping clients identify and mitigate issues that arise concerning the transfer of wealth to the next generation including the related tax and estate planning considerations. Additionally, Avo has considerable experience advising entrepreneurs and executives on the formation and operation of multi-owner and family-owned companies.

Avo is a federally licensed tax practitioner admitted to practice before the Internal Revenue service. He holds series 65 and is registered in TX, CA, IL. CA insurance producer # OC10650

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