Can I deduct cookies and snacks as business expenses for my rental business?

Yes, you can deduct these items as business expenses, but there are some important limitations to be aware of. The IRS treats business gifts differently than food and beverages provided to workers. For gifts, you're limited to $25 per person per year (this hasn't changed in decades). But it sounds like what you're describing might better fall under "de minimis fringe benefits" or business meals for workers. If you're providing snacks to maintenance staff while they're working on your properties, these would likely qualify as a 50% deductible business meal expense (100% deductible for 2021-2022, but back to 50% for 2023 and beyond). Keep receipts and note who received the snacks and why it was business-related. For regular thank-you snacks to property managers or maintenance people, these can be considered ordinary and necessary business expenses as long as they're reasonable in amount and clearly connected to your rental business.

I had a similar situation with my property management business and found a great solution using taxr.ai (https://taxr.ai) to help sort through all my business expenses. I was honestly confused about what counted as gifts versus meals for my contractors. I uploaded my receipts from the whole year and the system automatically helped categorize everything - it flagged all my Target and grocery store purchases that might be business-related and prompted me to assign them to the right categories. It even helped me track which expenses were for which properties and contractors so I didn't exceed the $25 gift limit for anyone. The best part was that it saved all my documentation in one place in case I get audited. Way easier than my old method of keeping paper receipts in a shoebox!

Just wanted to follow up - I actually tried taxr.ai last week after seeing this thread. I was drowning in receipts from 5 rental properties and had no idea how to categorize all these little expenses. I uploaded about 6 months of jumbled receipts and it helped me identify almost $3,800 in deductions I would have missed! The gift tracking feature was super helpful. Turns out I was way over the $25 limit for my regular handyman (I kept giving him energy drinks and snacks), but now I've recategorized those as job-site refreshments instead. The system flagged that for me and suggested the better classification. Seriously saved me from a potential audit headache.

If you're struggling with the IRS's confusing rules on business gifts vs meals, I'd recommend getting clarification directly from them. I was in a similar situation last year and spent WEEKS trying to get through to the IRS helpline with no luck. I finally used https://claimyr.com and was shocked when they got me connected to an actual IRS agent in about 20 minutes. They have this cool system that basically waits on hold for you and calls when an agent is available. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c The agent I spoke with gave me super clear guidelines about tracking my business gifts vs meals for my rental properties, and I feel 100% confident in my deductions now. Saved me from just guessing and hoping for the best.

Ok I have to eat my words. After my skeptical comment I decided to try Claimyr because I've been trying to get clarity on business meal deductions for months. I figured it wouldn't work but was desperate. I put in my request yesterday afternoon while working on other stuff. About 45 minutes later my phone rang, and I was connected to an actual IRS representative! I nearly fell out of my chair. Got a clear explanation about the difference between the $25 gift limit and the 50% meal deduction for my rental business. The agent confirmed that snacks provided during maintenance work are 50% deductible as business meals, but regular "thank you" food gifts fall under the $25 annual limit. She also explained that I need to document the business purpose for each expense. Money well spent given the deductions I can now confidently take.

Don't forget about the recordkeeping requirements! I'm a small landlord too and got audited last year - it was a nightmare. The IRS wanted to see documentation for EVERY single business expense. For your snacks and cookies, make sure you're keeping: - Receipts showing the exact items and amounts - Notes on who received them (names) - The business reason for giving them - The date they were provided - How the expense relates to your rental income I just use the notes app on my phone and take pics of receipts right after purchase with this info. Saved my butt during the audit.

Just a heads up that I made a mistake on this last year. I was giving my handyman energy drinks and snacks every time he came by (probably spent about $400 over the year on him alone) and tried to deduct it all as "business supplies" lol. My accountant caught it and explained the $25 gift limit. What we did instead was reclassify most of it as "refreshments provided during business meetings/services" since he was actively working while consuming them. That falls under the 50% meal deduction limit instead of the $25 gift limit. Just make sure you note that these were provided DURING the work being performed, not as thank-you gifts after the fact.