Meals & Entertainment 

Discover the hidden value in your Meals & Entertainment (M&E) expenses. If your M&E deductions aren’t treated properly, they can end up costing thousands, even millions, of dollars more than they should. KPMG can help you realize more of the tax advantages from your M&E expenses.
A typical KPMG M&E tax review often results in a 10 to 15 percent reclassification. For a company with a 40 percent effective tax rate and a disallowed meals and entertainment expense of $3 million per year, a reclassification can amount to an additional $180,000 in permanent tax savings. Now multiply this by up to three years (as provided by Rev. Proc. 2004-29) and the value of our reviews becomes even more apparent.

It all adds up to advantages you can count on:

  • Increase cash flow by identifying M&E that should be deducted at 100 percent, which can permanently reduce your federal and state tax expenses
  • Mitigate risk by identifying and addressing potential tax exposures
  • Reduce effective tax rate by identifying potential permanent tax deductions
  • Control spending by helping M&E and/or p-card administrators identify frequent user errors; time periods in which unusually high errors can be found; and areas of company policy that may require further clarification
  • Implement better controlsso your processes are enhanced for the future
  • Create IRS audit-ready electronic deliverables that provide supporting documentation in case of audit



Contact:

For more information on how your company can increase saving and reduce its effective tax rate, contact:

French L. Taylor II
Partner – West Leader
T: 214-840-4148
E:frenchtaylor@kpmg.com

Darrin Holley
Partner – East Leader
T: 202-533-6466
E: dholley@kpmg.com