After a recent dinner in North Carolina, Peyton Manning left a $314 tip. While the amount of the tip is more than most spend on a nice dinner out, the tip was more than 50 percent the total $625 bill.
Peyton’s server from the Angus Barn steakhouse post a photograph of the receipt on the Internet, leading to the server’s employment being terminated for violating the restaurants privacy policy.
It is unknown who Peyton shared a steak with but Manning, who was recently released by the Indianapolis Colts, but if his meal was for business purposes he may be able to deduct a portion of the meal.
Generally, 50 percent of food and beverage are allowed as a deduction for business entertaining if they are both ordinary and necessary and meet either the directly-related test or associated test.
To be directly-related, the entertainment must have taken place in a clear business setting or the main purpose was to active conduct business, business was discussed and you have an expectation of income or another business benefit.
A deduction may also be taken if the entertainment is associated with your trade or business and the entertainment occurred directly before or after a substantial business discussion.
If Peyton had the meeting with his agent or with a potential team and football was discussed, Peyton may try to deduct 50 percent of the bill including his $314 tip.
Since an 18 percent gratuity was already included in the bill, it is unlikely that the additional $200 was a “necessary” business expense.
Tell us what you think. Comment below.
Great for Payton! Not so great for the fired employee. Oops!
What if the waiter was Jerry Jones’ cousin? Payton may try to deduct as job-search expense.
Good question Dallas. Is a job-search expense deductible as a business expense?
Depends how good his accountant is. Or his lawyer. Even better if they’re the same person!
Come to think of it…”If Peyton had the meeting with his agent or with a potential team and football was discussed” …and HE was the one picking up the bill, then he shouldn’t be doing business with them.