Posted on Accounting Today 8/19/15, by Roger Russell.
The Boston Bruins hockey team is taking the Internal Revenue Service to court over its habit of deducting 100 percent of the cost of away-game meals.
Employers may generally deduct up to 50 percent of the cost of meals for employees. An exception is if the meals are furnished for the convenience of the employer and on the employer’s business premises, in which case the employer may deduct 100 percent of the cost.
Boston Bruins owner Jeremy Jacobs filed a petition in the Tax Court on July 27 disputing the 50 percent limitation on the meals provided Bruins players in their away games during the years 2009 and 2010. The Bruins practice of taking 100 percent of deductions for team meals during road trips was similar to the exception for employer-operated eating facilities, the petition maintained, since the hotels at which the team meals were consumed constituted its “base of operations” during away games.
“Use of the away city hotel is extensive, requiring that the hotel provide rooms for each player and staff member, private meeting rooms, eating facilities, and space for physical therapy and medical treatment,” Jacobs contended in the petition filed with the Tax Court.
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