Washington, D.C. (May 6, 2004) -- A new revenue procedure allows the use of statistical sampling in determining deductible business meal and entertainment expenses.
While deductions for M&E expenses generally are limited to 50 percent of the expense, the 50 percent disallowance does not apply to certain M&E expenses. This revenue procedure provides a statistical sampling methodology for use in establishing the amount of substantiated M&E expenses that are excepted from the 50 percent disallowance. The proper use of statistical sampling will relieve taxpayers, especially those with large M&E accounts, of the burden of scrutinizing each item relating to an M&E amount.
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