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274(e) 4 & 5 vs. 132 (e)(1)

Technical topics regarding tax preparation.
#1
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Virginia
Good evening All,

I hope you are having a good day.

If you have a fishing trip in which all the employees are eligible to attend, and say 10 employees go and it costs $2,000. Under 274(e) 4 this is a tax deductible, and I believe 100%.

Is this deduction subject to the further test of 132(e)(1) De Minimis Fringe of

a. infrequent

b. so small as to make accounting unreasonable

For this example assume the $200 per person is accountable.

My thinking is the the deduction under 274(e) 4 is not subject to 132(e)(1).

Looking for a court case. :)

Thanks,

Art
 

#2
novacpa  
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Arlington, Virginia
Art: See if this case helps - held for the Taxpayer. Page 29 discussion of IRC Sec 132 (e)(1)
T.C. Memo. 2004-179
UNITED STATES TAX COURT
RAGNHILD A. WESTBY, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
 


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