My wife and I have separate businesses. She works in real estate, and I work in insurance. Sometimes we meet over dinner to discuss business and refer clients to each other. These discussions always generate good ideas and generally lead to new revenue. Can we deduct the meals?
In a recent tax court case, Fitch v Commr., the IRS took the position that business meals with spouses alone are not deductible.
In Fitch, the court ruled against the CPA husband and his realtor wife for two reasons:
The Fitches kept bad records of the business purposes for their spousal meals. Rather then list why they had the meal, the Fitches simply had ... Log in to view full article.