Tax Law (Questions About Taxes)/contractor deduction


Hello and thanks for donating your time and expertise.

I have a very small business and only hire independent contractors - frequently, I will hire some and pay them $X plus lunch for a day's work.

I would like to be able to deduct the meal expense as a regular labor cost since lunch is part of the compensation and not entertainment.

Do I simply add the cost of the meal to the $X I pay them?

In other words, if I offer them $100 plus lunch to work the day and lunch is $12, can I simply claim $112 as a labor cost?

Thank you



Thanks for your question.

That depends. If you report the amount paid and the lunch on the 1099-MISC you give the worker, you would include the full amount of the lunch. In this case, you should indicate that $12 (or whatever amount) is included in the number as meals.This allows him to treat it properly on his taxes. If you don't report the lunch on the 1099-MISC you can only deduct half the lunch. Any lunch amount on the 1099 does not have to be on the actual 1099 itself.

Hope this helps.

John Stancil, CPA

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John Stancil, CPA


I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at I also offer seminars and consultations to churches and clergy on their tax issues at Also visit my blog, I am listed on Tax Connections at Prepare and file your own taxes at


I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

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