Limited Deductions for Business Gifts
Your deduction for gifts to business customers and clients is limited to $25 per person per year. You and your spouse are treated as one person in figuring this limitation even if you do not file a joint return and even if you have separate business connections with the recipient. The $25 deduction also applies to partnerships. Gifts are considered as gifts by the partnership even if there are multiple partners. Gifts not falling under this rule and scholarships that are tax free and prizes and awards that are tax free under specific rules and awards to employees.
Packaged food or drink given to a business associate is a gift if it is to be consumed at a later time. Theater or sporting event tickets given to business associates are entertainment, not a gift, and if you accompany them under the new tax act are not deductible at all. If you do not accompany them you may treat the tickets as gifts, subject to the $25 limitation.