Thanks for Lunch!

The IRS is auditing employers that provide cost-free and tax free meals to employees, and changes to the existing regulations will most likely be forthcoming.

For now, these conditions qualify for tax-free employer-provided meals:

  • De minimis value meals for an occasional team-building meeting or picnic
  • Meal money given to an employee who must work late occasionally
  • Meals provided in a company cafeteria, if the annual revenue equals or exceeds its direct operating costs
  • Meals for employees who must stay at work for emergencies or to handle customer issues
  • Meals for employees because the workload requires brief meal breaks or the work location is so remote that employees can’t eat out

The IRS will find that your meals are taxable if you:

  • Let employees choose cash or meals
  • Don’t have a reasonable record of emergencies or customer issues that need to be handled; in other words, don’t create a situation just so you can bring in a meal
  • Define your work location as “remote” by ridiculously small boundaries
  • Don’t consider alternative ideas to brief meal breaks, like extended work days or staggered meal times

Get a Free Demo

Fill out the form below & we'll email you a video product demo!

Which solution are you interested in?
Optimum Solutions will not sell, rent, or lease your personal information.

Vice President of Human Resources Tom Griggs, U.P. Special Delivery, Inc.

I have worked with several different payroll systems in my career and your program is far and away the best I have ever used, but what makes your company so special to me is the Customer Service Representatives.