Liz is an employee who regularly entertains customers in connection with her job. In the current year, Liz incurs $6,000 in business meal expenses that are connected with entertainment. Liz’s expenses are not lavish or extravagant. She itemizes her deductions in the current year.
a. If none of these expenses are reimbursed by Liz’s employer, what amounts are deductible and how are they classified?
b. How are these amounts reported by Liz and her employer if all of her expenses are reimbursed and an adequate accounting is made by Liz?