Brewing Up Deductions: Can You Write Off Starbucks?

Are you wondering if your daily Starbucks habit can help lower your tax bill? The answer, as with many tax-related questions, is a classic CPA favorite: it depends! When it comes to deducting that coffee run, context matters. Let’s break it down so you can sip smarter and maximize your deductions.

When Your Starbucks Is Deductible

If your Starbucks purchase is tied directly to your business, you may be in luck. Here are a few scenarios where your coffee could qualify as a deductible business expense:

1. Business Meetings: Grabbing coffee while discussing business with a client or colleague? Deduct away! Just make sure the meeting’s purpose is clearly business-related.

2. Client Entertainment: Treating a client to a latte while discussing your services? This could also qualify.

3. Work-Related Travel: If you’re traveling for work and need your caffeine fix, that Starbucks stop may count as a travel expense.

Key Rules to Follow

To stay on the IRS’s good side, keep these tips in mind:

1. Document the Purpose: Always jot down the “who, what, and why” of the purchase on the receipt. For example, “Brainstorming session with Client A.”

2. Be Reasonable: While it’s tempting to splurge on that $10 super-fancy drink, the IRS expects expenses to be reasonable and not extravagant.

3. Separate Business from Personal: Your everyday morning latte on the way to the office? That’s considered a personal expense, not deductible.

Don’t Go It Alone

Navigating tax deductions can feel like venturing into a maze. But you don’t have to do it alone! A qualified CPA can help ensure you’re staying within the rules while maximizing your deductions.

Take Action Today

Need help sorting your coffee runs into deductible and non-deductible categories? Capri CPA is here to make your tax season less stressful. Contact us today for expert advice and personalized support!

Keep those receipts handy, and when in doubt, ask your CPA (that’s me!) to make sure you’re within the tax rules!