Is Your Coffee Actually a Business Expense? Here's What to Know
Here’s a common budgeting mistake we see over and over again, that can lead to bigger issues down the line. If you’re heading to a coffee shop or restaurant to work by yourself (even if you’re taking virtual client calls from there) it’s not a business expense.
I know what you’re thinking: “But I’m working on my business… how could it not be deductible?” 🙃
Don’t get me wrong, I love working at coffee shops! But the IRS sees it differently: solo coffee shop trips simply don’t qualify as deductible business expenses.
That doesn’t mean every coffee you have (or buy) doesn’t qualify, which is why I’m sharing this quick guide to make your business spending less stress come tax time:
Here’s When Your Coffee is Considered a Business Expense (and Tax Deductible)
While the latte during your solo work sessions at your local starbucks or fave coffee shop doesn’t count as a business expense, it can count if it’s because (or while) you’re:
Having a meal with a client. For example, you meet a client for a consultation or catch-up on a project and enjoy a coffee with a warmed croissant—that’s a business expense.
Stopping for a coffee and snack as a meal while you’re traveling for business. For example, that slightly overpriced chai with a snack box from the Airport coffee shop on the way to a conference could be considered a business expense.
Networking! For example, when you schedule a coffee & co-working date with your business BFFs.
P.S. Coffee (like k-cups or coffee grounds) used ONLY for a coffee maker that is for use exclusively in your in your home office, while working, can be considered a business expense and are tax deductible.😉 But remember, for this deduction & any deduction you take in your business, it's you're responsibility do document and prove that something was exclusively for business in the case of an audit!
When Coffee Isn’t Considered a Business Expense
It’s not necessarily limited to your solo-coworking sessions, but coffee is not considered a business expense when:
You’re meeting for a coffee with friends. Unless they have some type of relationship with your work (client, business friend, co-worker, etc.) it’s not considered a business expense.
You’re stopping for a quick latte (or cold brew, any coffee really) to drink in your office. According to the IRS, this doesn’t count (sorry).
Virtual co-working calls. I wish these counted, but they don’t! It’s only deductible if the person you’re working with is in-person at the location/meal with you.
Now if you do want to budget your coffee trips from your business bank account, this is what I do: pay for your coffee trips with your personal card, then take an extra owner’s draw for the amount spent at the end of the month.
You’re still not able to pay for your solo coffees or lunches through your business directly, but you can make sure that your owner’s draws are reflecting those personal expenses that help you stay productive, efficient, and caffeinated.
How to Stay Caffeinated and Compliant in 2026
The bottom line? Solo coffee shop workdays = personal expense. Meals with your clients, your team, or while traveling for business = deductible.
If you slip up and use your business card for a personal trip, don’t panic. It’s not the end of world—let your bookkeeper know and discuss with your CFO about setting up additional owner’s compensation to support the habits that keep you productive!
And always, always, keep track of your receipts, what was purchased, the business topics that were discussed, and who was there with you.
However, try your best NOT to mix personal and business! The more you mix personal and business finances, the more at-risk your liability protection is in your LLC.
Wish you had a CFO to ask instead of asking Google or ChatGPT and hoping they’re right? Book a consultation for our CFO services, we help entrepreneurs (like you) make smart, strategic moves in your business with confidence! → Learn more here!
