When meals and entertainment are entered as a deduction on Screen 13, Deductions in the section Meals and Entertainment > Meals in full (50% deductible), the 50% that is nondeductible on the tax return is available to specially allocate to the partners.
To specially allocate meals and entertainment
- Go to Screen 29, Special Allocations.
- Expand the folder Schedule M-1.
- If the tax return is using M-3 instead of M-1, a special allocation will appear containing the same information. It isn't necessary to specially allocate this amount as it is a duplicate of the amount allocated as the M-1 adjustment.
- Expand the folder Nondeductible Expenses.
- Select Travel and Entertainment.
- Enter the allocation amounts or percentage, per partner.
