You can deduct the cost of meals if you are traveling away from home and need to stop for sleep or rest (you are traveling overnight, for example), or if the meal is business-related entertainment. You cannot deduct expenses that are “lavish or extravagant”. The expenses must be reasonable, but there is no fixed dollar amount established.
50% Limit
You can deduct meal expenses based on actual cost or a standard allowance. But regardless of the method, you can generally deduct 50% of the un-reimbursed cost of your meals. If you use actual cost, you need to keep your receipts.
Standard Meal Allowance
Instead of the actual cost, you may be able to claim the standard meal allowance for your meals and incidental expenses (M&IE). Under this method, you deduct a specified amount, depending on where and when you travel, instead of keeping records of your actual meal expenses.
The standard meal allowance used for tax deduction purposes is the same rate used by the federal government. Most major cities and many other localities in the United States are designated as high-cost areas and qualify for higher rates. These rates are available in Publication 1542, Per Diem Rates, available on the IRS website.
If you use the standard allowance rate, you will still need to keep records showing the time, place, and business purpose of your travel. This standard allowance rate includes incidental expenses such as tips. So if you use the standard rate for meals, you cannot use the optional rate for incidental expenses ($3 per day) described above.
Also, if you use the standard meal allowance, you will need to prorate the daily rate for your day of departure and the day of your return, if you are traveling away from home. You can claim ¾ of the daily allowance for each of these two days, or you can use another reasonable method if it is applied consistently.
Transportation Workers
If you are considered a transportation worker; that is your work:
directly involves moving people or goods by plane, barge, ship, train, bus, or truck, and
regularly requires you to travel away from home to areas eligible for different standard meal rates,
you can claim a special standard meal allowance rate. There are two rates, for travel in the U.S. and for travel outside the continental U.S.. These rates are generally established by year, and can be found in IRS Publication 463, Travel, Entertainment, Gift, and Car Expenses.