In 2019, Robert entertains four key clients and their spouses at a nightclub. Business discussions occurred over dinner and prior to the entertainment beginning. Expenses were $285 (limo charge), $125 (cover charge), $1,190 (drinks and dinner), and $238 (tips to servers). If Robert is self-employed, how much can he deduct for this event?

Question

Business

Pennington

27 August, 12:30

In 2019, Robert entertains four key clients and their spouses at a nightclub. Business discussions occurred over dinner and prior to the entertainment beginning. Expenses were $285 (limo charge), $125 (cover charge), $1,190 (drinks and dinner), and $238 (tips to servers). If Robert is self-employed, how much can he deduct for this event?

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Answers (1)

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Reid Benjamin · Answer 1

Total deduction = $680

Explanation:

Deductions:

Deductions are a source of revenues and expenses that a person can deduct from the annual gross income before calculating the annual gross income. after deductions, the taxable income gets reduced which ultimately results in fewer taxes.

Answer and Explanation:

Calculate the amount of deduction as shown below:

Details Amount

Limo charges $200

Add: Cover charge (50% cutback adjustment)

($120*50%) $60

Add: Drinks and Dinner (50% cutback adjustment)

($700*50%) $350

Add: Tips to servers (50% cutback adjustment)

($140*50%) $70

Total deduction $680