Documenting all the “W’s” for Travel, Meal, and Entertainment Expenses

By Kenneth H. Bridges, CPA, PFS     July 2015

Because of the inherent potential for abuse, tax rules require a higher level of substantiation for travel, meal and entertainment expenses.  For these expenses to be tax deductible, you must document what we refer to as all of the W’s; the who, what, when, where and why.  The what, when and where are generally obvious from the credit card receipt or statement.  What is often missing, however, is the who and why.  For example, with respect to a travel expense it may be obvious that you flew from Atlanta to New York on July 6, stayed at the Four Seasons, and returned to Atlanta on July 10.  However, you must also document who you visited while there (e.g. a customer or prospective customer) and why this was business related (e.g. check on status of project for customer).  Similarly, for a non-travel related meal expense, you must document who was present and why this was business related.

Kenneth H. Bridges, CPA, PFS is a partner with Bridges & Dunn-Rankin, LLP an Atlanta-based CPA firm.

This article is presented for educational and informational purposes only, and is not intended to constitute legal, tax or accounting advice.  The article provides only a very general summary of complex rules.  For advice on how these rules may apply to your specific situation, contact a professional tax advisor.