• Denise Hue

Operating Costs of Entertainment Facilities Still Nondeductible.

The Tax Cuts and Jobs Act does not change the prior law rule disallowing a deduction for the expenses of maintaining and operating facilities used to entertain clients and customers. Examples of entertainment facilities include yachts, hunting lodges, fishing camps, swimming pools, tennis courts, bowling alleys, automobiles, airplanes, apartments, hotel suites, or homes in a vacation area. The disallowance rule applies to operating expenses such as rent, utilities, and security, and also to depreciation, but not to such expenses as interest, taxes, and casualty losses that are deductible without having to show business purpose.

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