50 Percent Rule for Self Employment Tax

"Hi, I’m Tom Choisnet enrolled agent and we are having a discussion right now about the fifty percent entertainment rule. The general rule on entertainment expenses, meals and entertainment is that fifty percent of the expense is deductible, rather than the whole amount as in the old days. I might make a quick mention here that transportation employees under the law get seventy-five percent deducted, as theirs is a favored occupation. There are some exceptions and I jotted them down, the exceptions are for food on premises, if you provide food and snacks in the break room, that is a hundred percent deductible, recreation for employees such as a company picnic, that is a hundred percent deductible and further if there are charity sports events. I remember years ago, they used to have donkey baseball, boy is that something, they don’t have that anymore because of the liability situation today, but charity sports events are a hundred percent deductible. I hope that I enlightened you a little bit about how the fifty percent rule applies on entertainment, thank you."