By: Diane Benjamin
This receipts were obtained under the Freedom of Information Act. The PCard report only stated Business Lunch – Tari Renner. Since Tari’s calendar had already been obtained by FOIA, I can tell who he ate with. (click on the receipts to enlarge)
Either their shared or Jim paid for his own lunch!
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County Administrator:
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Nothing on the calendar for lunch – eating by himself?
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Why is Tari buying lunch for citizens?
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Former Mayor’s get free lunches too!
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IRS Publication 15-B Employer’s Tax Guide to Fringe Benefits:
Meals
This section discusses the exclusion rules that apply to de minimis meals and meals on your business premises.
De Minimis Meals
You can exclude any occasional meal you provide to an employee if it has so little value (taking into account how frequently you provide meals to your employees) that accounting for it would be unreasonable or administratively impracticable. The exclusion applies, for example, to the following items.
Coffee, doughnuts, or soft drinks.
Occasional meals or meal money provided to enable an employee to work overtime. However, the exclusion doesn’t apply to meal money figured on the basis of hours worked.
Occasional parties or picnics for employees and their guests.
This exclusion also applies to meals you provide at an employer-operated eating facility for employees if the annual revenue from the facility equals or exceeds the direct costs of the facility. For this purpose, your revenue from providing a meal is considered equal to the facility’s direct operating costs to provide that meal if its value can be excluded from an employee’s wages as explained under Meals on Your Business Premises , later.
If food or beverages you furnish to employees qualify as a de minimis benefit, you can deduct their full cost. The 50% limit on deductions for the cost of meals doesn’t apply. The deduction limit on meals is discussed in chapter 2 of Pub. 535.
Employee. For this exclusion, treat any recipient of a de minimis meal as an employee.
Employer-operated eating facility for employees. An employer-operated eating facility for employees is an eating facility that meets all the following conditions.
You own or lease the facility.
You operate the facility. You are considered to operate the eating facility if you have a contract with another to operate it.
The facility is on or near your business premises.
You provide meals (food, drinks, and related services) at the facility during, or immediately before or after, the employee’s workday.
Exclusion from wages. You can generally exclude the value of de minimis meals you provide to an employee from the employee’s wages.
Exception for highly compensated employees. You can’t exclude from the wages of a highly compensated employee the value of a meal provided at an employer-operated eating facility that isn’t available on the same terms to one of the following groups.
All of your employees.
A group of employees defined under a reasonable classification you set up that doesn’t favor highly compensated employees.
For this exclusion, a highly compensated employee for 2016 is an employee who meets either of the following tests.
The employee was a 5% owner at any time during the year or the preceding year.
The employee received more than $120,000 in pay for the preceding year.
You can choose to ignore test (2) if the employee wasn’t also in the top 20% of employees when ranked by pay for the preceding year.
Meals on Your Business Premises
You can exclude the value of meals you furnish to an employee from the employee’s wages if they meet the following tests.
They are furnished on your business premises.
They are furnished for your convenience.
This exclusion doesn’t apply if you allow your employee to choose to receive additional pay instead of meals.
On your business premises. Generally, for this exclusion, the employee’s place of work is your business premises.
For your convenience. Whether you furnish meals for your convenience as an employer depends on all the facts and circumstances. You furnish the meals to your employee for your convenience if you do this for a substantial business reason other than to provide the employee with additional pay. This is true even if a law or an employment contract provides that the meals are furnished as pay. However, a written statement that the meals are furnished for your convenience isn’t sufficient.
Meals excluded for all employees if excluded for more than half. If more than half of your employees who are furnished meals on your business premises are furnished the meals for your convenience, you can treat all meals you furnish to employees on your business premises as furnished for your convenience.
Food service employees. Meals you furnish to a restaurant or other food service employee during, or immediately before or after, the employee’s working hours are furnished for your convenience. For example, if a waitress works through the breakfast and lunch periods, you can exclude from her wages the value of the breakfast and lunch you furnish in your restaurant for each day she works.
Example.
You operate a restaurant business. You furnish your employee, Carol, who is a waitress working 7:00 a.m. to 4:00 p.m., two meals during each workday. You encourage but don’t require Carol to have her breakfast on the business premises before starting work. She must have her lunch on the premises. Since Carol is a food service employee and works during the normal breakfast and lunch periods, you can exclude from her wages the value of her breakfast and lunch.
If you also allow Carol to have meals on your business premises without charge on her days off, you can’t exclude the value of those meals from her wages.
Employees available for emergency calls. Meals you furnish during working hours so an employee will be available for emergency calls during the meal period are furnished for your convenience. You must be able to show these emergency calls have occurred or can reasonably be expected to occur.
Example.
A hospital maintains a cafeteria on its premises where all of its 230 employees may get meals at no charge during their working hours. The hospital must have 120 of its employees available for emergencies. Each of these 120 employees is, at times, called upon to perform services during the meal period. Although the hospital doesn’t require these employees to remain on the premises, they rarely leave the hospital during their meal period. Since the hospital furnishes meals on its premises to its employees so that more than half of them are available for emergency calls during meal periods, the hospital can exclude the value of these meals from the wages of all of its employees.
Short meal periods. Meals you furnish during working hours are furnished for your convenience if the nature of your business restricts an employee to a short meal period (such as 30 or 45 minutes) and the employee can’t be expected to eat elsewhere in such a short time. For example, meals can qualify for this treatment if your peak work-load occurs during the normal lunch hour. However, they don’t qualify if the reason for the short meal period is to allow the employee to leave earlier in the day.
Example.
Frank is a bank teller who works from 9 a.m. to 5 p.m. The bank furnishes his lunch without charge in a cafeteria the bank maintains on its premises. The bank furnishes these meals to Frank to limit his lunch period to 30 minutes, since the bank’s peak workload occurs during the normal lunch period. If Frank got his lunch elsewhere, it would take him much longer than 30 minutes and the bank strictly enforces the time limit. The bank can exclude the value of these meals from Frank’s wages.
Proper meals not otherwise available. Meals you furnish during working hours are furnished for your convenience if the employee couldn’t otherwise eat proper meals within a reasonable period of time. For example, meals can qualify for this treatment if there are insufficient eating facilities near the place of employment.
Meals after work hours. Meals you furnish to an employee immediately after working hours are furnished for your convenience if you would have furnished them during working hours for a substantial nonpay business reason but, because of the work duties, they weren’t eaten during working hours.
Meals you furnish to promote goodwill, boost morale, or attract prospective employees. Meals you furnish to promote goodwill, boost morale, or attract prospective employees aren’t considered furnished for your convenience. However, you may be able to exclude their value as discussed under De Minimis Meals , earlier.
Meals furnished on nonworkdays or with lodging. You generally can’t exclude from an employee’s wages the value of meals you furnish on a day when the employee isn’t working. However, you can exclude these meals if they are furnished with lodging that is excluded from the employee’s wages as discussed under Lodging on Your Business Premises , earlier in this section.
Meals with a charge. The fact that you charge for the meals and that your employees may accept or decline the meals isn’t taken into account in determining whether or not meals are furnished for your convenience.
Can we handle any more IRS guidance on the subject? If so, Pub 5137 “Fringe Benefit Guide” is helpful
De Minimis Exclusion for Occasional Meal Reimbursements Regularly-provided meal money does not qualify for the exclusion for de minimis fringe benefits provided by an employer. Occasional meal money can meet an exception and be excludable, if the following three conditions are met: Occasional Basis – Meal is reasonable in value, and is not provided regularly or frequently Provided for Overtime Work – Overtime work necessitates an extension of the employee’s normal work schedule Enables Overtime Work – Provided to enable the employee to work overtime. Meals provided on the employer’s premises that are consumed during the overtime period, or meal money expended for meals consumed during that period, satisfy this condition. Reg. §1.132-6(d)(2)
If meal reimbursements are provided as part of a company policy or union contract, they are not excludable as de minimis benefits, because the benefit is required and is not occasional. The employer would normally have the opportunity to set up the administrative procedures for reporting the benefit, so accounting for it does not meet the “administratively impracticable” standard for de minimis benefits.
Meal money calculated on the basis of number of hours worked (for example, $5.00 per hour for each hour worked over 8 hours) is never excludable as a de minimis fringe benefit. Reg. §1.132-6(d)(2)
Somebody needs to calculate the total and send it to the IRS.
Well, w/o seeing Dr. Mayor Renner’s w-2 first . . . who knows . . . maybe City is tallying these meals and including them in reportable income.
Regardless of whether City properly reports it as gross income to him . . . it is ultimately his responsibility to properly report it on his personal income tax return. Blaming an erroneous reporting document (W-2 or 1099) is not a defense to underreporting personal income.
Oh, and if City isn’t withholding tax on these amounts . . . I guess I hope Dr. Mayor is remitting quarterly estimated payments. Else he might have a very large, unexpected tax bill someday that could include the tax, penalties and interest. It could end up costing him personally much to have been Mayor, monetarily speaking, than what it’s worth.
Undischargeable IRS debt for eating out. Kinda scary. Safest move now would be to lay low and quit eating out. Just sayin’
They aren’t. He has stated he is entitled.
Wonder what IWU would say about Renner charging them for meals. Or maybe IWU feeds the employees for free. He’s been hanging around too many millennials causing him to feel entitled. He should pay out of own pocket for his meals, especially the ones where he dines alone or feeds citizens. Where’s my free lunch!!
LOL! You think he takes his taxes to H & R Block, too 🙂 Or spends a confuddled, consternated weekend in front of TurboTax:)
I bet he pays big bucks – he’s got a BMW to write off now.
The last time I saw him at Barnes and Noble he drove off in a Mustang convertible I believe it was. That was a few months ago.
He has upgraded.
He must have traded in his Corvette unless he now owns 3 mid-life crisis cars.