Subscribe to Entrepreneur for $5

Deducting Your Entertainment Costs

How much is it legal to deduct?

Opinions expressed by Entrepreneur contributors are their own.

On the entertainment side, allows you to deduct 50 percent of meals and entertainment expenses that are business-related. To qualify, you must be able to show that the expense directly preceded or followed a substantial, bona fide business discussion or that it's directly related to the active conduct of your or business. You must keep good records, which include a receipt for any expenditure of $75 or more. , picnics and other social events you put on for your employees and their families are an exception to the 50 percent rule. Such events are 100-percent deductible.

Entrepreneur Editors' Picks