Groceries are a large part of pretty much everyone’s monthly expenses. On average, Americans spend over $1,000 a month on groceries, according to recent data from the Census Bureau’s Household Pulse Survey. Food is a major expense, and if you’re a self-employed worker, you’re probably wondering: Are groceries tax deductible?
Short answer: not usually. But don’t throw away your grocery receipts just yet. There are a few instances where you can deduct the expense. Here’s when you can — and can’t — write off groceries as a business expense.
What is a tax write-off?
Tax write-offs are legitimate expenses you can deduct from your taxable income, thereby lowering the amount you pay in taxes. The type of tax write-off we’ll discuss here is the business expense, which is a tax write-off related to the cost of running a business. The key is that the expenses are “ordinary and necessary,” which means that they’re “both common and accepted in your industry,” according to the IRS.
Let’s imagine you own an in-person tutoring business. You spend $200 each month on pencils, paper, computer program licenses, and textbooks. Because you bought the items for your business, the expense is tax-deductible. Your taxable earnings are $2,000 each month, but you only need to pay taxes on $1,800 thanks to your write-off. Pretty cool, huh?
Business write-offs vary widely and depend on your industry, business setup, and overhead expenses. They can save you hundreds or thousands of dollars in taxes each year, so take time to investigate which ones apply to you.
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Can you write off groceries on your taxes?
Here's the bad news: Groceries aren't usually tax-deductible. Not even if you’re buying snacks to stock your home office or groceries for a meal you eat at your desk.
Why? Whether you have a business or not, groceries are a necessary personal expense when you're home. You would buy the food regardless. Unfortunately, that means it’s not a necessary business expense in the eyes of the IRS.
Business meals, on the other hand, are usually tax-deductible. So what's the difference? When you eat out with a client, potential client, or coworker, you can deduct the food expense from your taxes. But preparing food at home doesn't count. (Meal expenses don’t count if you’re dining out solo, either.)
Who can write off groceries on their taxes
Of course, there are a few exceptions. (It wouldn’t be tax-related if it wasn’t just a tiny bit complicated, right?)
Restaurant owners, for example, can write off the cost of grocery supplies used to make dishes. For example, imagine you have a sandwich food truck and sell $500 in sandwiches each day. But you also spend $200 on bread, mayonnaise, and other food supplies. Those supplies are write-offs, which means they can be used to reduce your taxable income. In the end, you’d only pay taxes on $300 of that day’s earnings.
Or imagine you review snacks on YouTube as a side gig. You can write off the snacks if you use them solely for business purposes — not for personal use.
For example, let’s say you’re filming a taste test video with different types of salsa to determine which is the spiciest. The salsas would be tax-deductible. (That’s good news for your wallet, but it might not be good news for your taste buds.)
Other self-employed professionals or business owners who might qualify to write off groceries include Airbnb hosts who buy supplies for their rentals, food bloggers, freelance chefs, and café owners.
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Writing off groceries as a business travel expense
Here’s a bit of good news. Grocery costs are tax-deductible once you’re away from home and traveling for business. As long as you’re away overnight, you can deduct 50% of your grocery costs (as long as they’re not lavish or extravagant). The same is true for meals, snacks, beverages, and even coffee.
Let’s say you spend $25 on grocery supplies for your mini fridge in the hotel room. You stock up on yogurt, granola, coffee pods, and creamer. You can deduct $12.50, or 50% of the cost, from your taxable income.
How to write off your groceries on your taxes
As a self-employed worker, you’ll claim your business tax deductions on Schedule C, which is part of the Form 1040 you complete every year.
Schedule C has a section for expenses, including a box for “other expenses” at the end of the section. This is where you can add eligible food expenses, including business travel groceries and legitimate grocery supplies for work-related content or products.
As you plan for your taxes as a self-employed person, you should consider all types of deductions. But should you keep your grocery receipts for taxes? For most people, probably not.
But even though regular groceries and office snacks aren’t tax-deductible, there are plenty of other ways to lower your taxable income. With Keeper, you can track them automatically — then file your taxes right on the app.
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What tax write-offs can I claim?
At Keeper, we’re on a mission to help people overcome the complexity of taxes. We’ve provided this information for educational purposes, and it does not constitute tax, legal, or accounting advice. If you would like a tax expert to clarify it for you, feel free to sign up for Keeper. You may also email support@keepertax.com with your questions.