Overnight Sleep Test
Categories: Marketing
You’ve got a business meeting downtown: a sales pitch to a potential client about the line of dog antidepressants your company manufactures. It takes about 15 minutes to drive to the customer's office. After your meeting, you grab lunch downtown and, still feeling a little tense after your sales call, you head over for a massage.
Fast-forward to tax time. Can you deduct lunch and the massage from your taxes as a business expense? After all, it was during the workday.
The overnight sleep test says "no." The rule of thumb helps determine what expenses, especially travel-rated ones, count as business expenses. There are some costs that obviously fall under the category of "business expenses." Business cards. Taking customers out to dinner. Dog food for your research subjects.
But other expenses are less clear-cut. Like the solo lunch you had after your meeting and the stress-relieving massage. The overnight sleep test says that, if these otherwise normal activities take place near your regular residence, they count as a normal, everyday activity. Not deductible. However, if you do them while you are on a business trip (that is, you have to stay overnight), you might be able to deduct them.
If you fly to Des Moines for a three-day veterinary medicine conference and get the same meal and massage when you're there, the deduction becomes much more justifiable as a business expense.
