20.22 Entertainment Costs of Spouses

A deduction is allowed for the spouses’ share of the entertainment costs if they were present during entertainment that qualified as directly related entertainment (20.17). For goodwill entertainment, the cost of entertainment of the spouses is deductible if your share and the business associate’s share of the entertainment is deductible. The IRS recognizes that when an out-of-town customer is accompanied by his or her spouse, it may be impracticable to entertain the customer without the spouse. Under such circumstances, the cost of the spouse’s entertainment is deductible if the customer’s entertainment costs are also deductible. Furthermore, if your spouse joined the party because the customer’s spouse was present, the expenses of your spouse are also deductible.