A Recipe for Tax Savings: Tax Deductions for Caterers

July 7, 2015
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For the best tax savings recipe, 1-800Accountant offers up several IRS tax deductions for caterers.

Do you make amazing lasagna? Can you craft a tasty chicken pot pie? Whatever you specialize in when it comes to culinary creations, there’s a good chance you are spending plenty of money on your ingredients and cooking supplies when preparing meals for others. The good news is that the IRS allows caterers to save some of their hard earned money through tax write-offs. These tax deductions for caterers will make your mouth water:

Cooking supplies

High-quality cooking supplies that hold up over time are important to any successful catering business. But don’t fret too much about the prices of them since you can enjoy some tax savings after purchasing them. Any items you use to prepare food for your clients can be deducted as business expenses. These may include pots, pans, cutting boards, utensils, blenders, and ovens.
Food and ingredients

Food and ingredients

Perhaps the biggest expense caterers incur falls under the category of actual food items and ingredients needed to prepare various dishes. If you bake homemade bread or apple pies, you’ll likely need flour, sugar, and butter. IF your specialty is seafood, you may need fresh fish, spices, and breadcrumbs. All food items you obtain for your catering business via a local grocery store or food supplier are considered tax deductible business expenses.

Eating supplies for your clients

You just can’t provide a catered meal to a house party or small business office without including some eating supplies. In addition to the food you bring, be sure to offer silverware, spatulas, plates, napkins, and maybe even a table cloth and table decorations. This will add a little pizzazz to your arrangement. And, of course, not all locations are stocked with some of these necessities. Eating supplies in a catering business are deductible.

Transporting items

Caterers need certain items to transport the food they deliver to their clients. These transporting items may include containers, platters, plates, bowls, cups, and other necessities. The transporting items a caterer uses depend on the types of food he or she is preparing. For example, if you provide soup or salad, you’d need different types of containers than if you serve pizza, chicken parmesan, or steak. The good news here is that all of these required items for a small business are fully deductible when filing taxes with the IRS.

Travel expenses

Caterers almost always deliver their food by car. While gas, tolls, and vehicle maintenance can add up quickly, you can write off your travel expenses to get your food into the mouths of your clients. You can claim the standard mileage rate (57.5 cents per mile for 2015) or deduct actual expenses for these delivery trips. Just be sure to keep a mileage log or documentation of these expenses as you should when deducting all of your business expenses.

Kitchen rental space

You might simply use your home kitchen to prepare food in your catering company. But if you rent out kitchen space in a separate location, the fees you incur to use such an area for food preparation qualify as a tax write-off as well.

If you run your own catering business, learn about more tax deductions for caterers that can help you keep more income in your business bank account by teaming up with the accountants at 1-800Accountant. Call 1-800-222-6868 or check out the “Services” page on www.1-800Accountant.

Image credit: The image included in this blog post is used with permission via the Flickr Creative Commons license.

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. 1-800Accountant assumes no liability for actions taken in reliance upon the information contained herein.