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Team meals and tax deductions: the Bruins versus the IRS

Hockey is not a game for the faint of heart. Speed and skill do play a role, but success often depends on aggressively challenging opponents for control of the puck.

The Boston Bruins are bringing that mindset into their dealings with the Internal Revenue Service. In this post, we will discuss the dispute between the Bruins and the IRS about tax deductions for team meals on road trips.

The general rule is that employers are allowed to deduct 50 percent of the cost of furnishing meals to employees. There are certain exceptions to this where the full cost can be deducted.

For example, employers can deduct the full amount of the meals when the meals qualify as de minimis fringe benefit to the employee. IRS Publication 15-B elaborates on the criteria for this deduction.

During tax years 2009 and 2010, the Bruins deducted the full amount of team meals on road trips. The IRS contends the team owes about $85,000 in additional taxes because the allowable deduction for employee meals was only 50 percent.

The Bruins are challenging the IRS in U.S. Tax Court. The team’s argument is that providing mandatory nutritious meals before games is a necessary business expense because it fuels players for the upcoming competition.

For Boston area sports fans, the issue of food on the job is a bit of sensitive one. In 2011, some critics cited clubhouse food as one factor in a late-season Red Sox collapse. The critics claimed that certain players were eating biscuits and fried chicken during games and drinking beer.

That was four years ago. Today, clubhouse meals are not complementary for Red Sox players; the players are required to pay for them.

It remains to be seen whether the Bruins will win their face-off with the IRS. But their aggressive style is clearly evident in the very occurrence of the issue.

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