Gifts you give to business associates are deductible up to $25 if you can
show a business purpose for the expense or business benefit to be
gained. (Married couples count as one person for this rule—you can’t
deduct $25 for each.) This includes family and friends if they qualify as
bona fide clients, prospects, or referral sources. Gifts are nontaxable to
- If you give gifts of entertainment or sporting tickets, you can choose to
deduct up to $25 as a gift, or 50% of the cost as an entertainment
expense. If tickets you give cost more than $50, you’ll save more by
counting them as entertainment.
- If you give a gift to a group of recipients, such as a family or an office,
you can deduct $25 for each member of the group.
- Ad specialties with a value up to $4 each are deductible as advertising
and don’t count against the $25 per person annual limit for business
gifts. Contest prizes you give to customers (but not employees) also