Giving Gifts and Lowering Taxes
If you give gifts in the course of your business, you can deduct all or part of the cost, but you cannot deduct more than $25 for each business gift that you gave away during the tax year. A gift that is intended for the eventual personal use or benefit of a particular person or class of people will be considered a gift to that person or class of people. If you give a gift to a member of a customer's family, the gift is generally considered to be an indirect gift to the customer. This rule does not apply if you have an independent business connection with that family member and the gift is not intended for the customer's eventual use. Incidental costs, like gift wrapping, packaging, insuring, and mailing, are generally not included in determining the cost of the gift. You cannot deduct gift items that cost less than $4 if they have your name clearly and permanently imprinted on the gift, or if the gift is one of many identical items that you widely distribute, like pens and ca...