Under new IRC Section 274(o), employer-convenience meals, including office snacks, coffee, overtime meals, and company cafeterias, are 100% disallowed starting January 1, 2026, down from the prior 50% deduction. Narrow exceptions remain for restaurants that feed both customers and staff and for the fishing industry.
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Employer-provided meals become 100% nondeductible from January 1, 2026
Why this matters for founders
Free-snacks and catered-lunch perks now carry a real after-tax cost, reprice these benefits or shift budget to fully deductible team events before year-end.
Source: CohnReznick
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