After work, I frequently go to "happy hour" with a number of coworkers.
I've heard that this can be tax deductible? Surely this can't be
true, but if it were, what could I do to ensure that it would be
a completely legitimate deduction that would absolutely bullet-proof
to an I.R.S. audit?
It's true! It's true! It's true!
That's the rule!
- Documented business purpose with the keyword "LEARN", followed by a brief description
of what was learned specifically. The key here is to learn something
from coworkers by sharing professional information, discussing
relevant business events of your profession and aspects of job knowledge with
each other. Learning does not stop after you leave school,
it a life-long activity that can be deductible because it
produces a future benefit for your business.
- Who? The name of the coworker(s) must
be given (or prospect, or client).
- What? Evidence of the nature of the expense is required…
was it breakfast, lunch, dinner, or snacks and drinks. Jot this down or save the itemized receipt of your purchases.
- Where? The place and circumstances must be established
to be appropriate and conducive to conducting business. A
restaurant or bar is perfect, and when you pay by credit card the name and address of the establishment is already documented on the receipt for you!
“The income tax has made more liars out of the American people than golf has.
Even when you make a tax form out on the level,
you don’t know when it's through if you are a crook or a martyr.”