This is the 2nd pandemic for the iconic 103-year old Wayside Restaurant in Montpelier, VT. There were no government programs to help them get back on their feet in 1918. Thanks to newly announced coronavirus legislation, there is great opportunity on the horizon.
A business owner can now enjoy breakfast, lunch or dinner at a local restaurant with a valued client or prospective customer and take a 100% tax deduction. This is great news for restaurants struggling across America.
Congress recently passed the Consolidated Appropriations Act, which includes making business meals, to include alcoholic beverages, fully tax deductible. Employers are now able to deduct 100% of their business meal expenses that are incurred in 2021 and 2022. “This is a big deal for the next two years that nobody seems to know about,” says Brian Zecchinelli, co-owner of the Wayside Restaurant.
Since 1980 businesses have only been able to deduct 50 percent of their meal expenses off their federal taxes. This coronavirus relief legislation was proposed by U.S. Senator Tim Scott of South Carolina. It has been heralded as pro-worker, pro-restaurant, and pro-small business—leading to increased spending in restaurants and more income for the employees.
The act, passed on December 21, 2020, encourages companies to conduct more business over meals. “It’s a win-win for both sides,” says Zecchinelli. The companies get a tax credit for supporting their local restaurants. “Any carrot that can entice our valued customers to dine out more often, we’ll take it,” he said.
Restaurants have been severely impacted during the pandemic. Vermont Chamber of Commerce President Betsy Bishop said “As of December 1, 2020, more than 110,000 eating and drinking establishments were closed for business either temporarily or for good across the country. We applaud the recent business meals deduction, included as part of the COVID relief, that supports Vermont restaurants when they need it most.”
With COVID-19 cases on the decline and many safety protocols in place, restaurants are ready to serve more business customers.
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