Can private foundations pay for food at board meetings?
Yes, private foundations can pay for breakfast, lunch, or dinner at board meetings using organizational funds.
Moreover, some advisors believe it is a good idea to include food at board meetings because it helps create a spirit of comradery and can cultivate a more productive team. Providing food sends a signal that both the meeting is valuable and that the board members are appreciated. Sharing a meal helps people feel more connected and committed to each other. An amicable and harmonious board is more likely to achieve its goals and follow through on commitments.
IRS guidelines state that the furnishing of food or beverages cannot be lavish or extravagant but a proper meal from a good restaurant is just fine. As long as the meal is reasonable it can be treated as an incidental benefit and does not trigger the self-dealing rules or count as compensation of any kind.
Some foundations, especially small ones, choose not to pay for meals as a way to keep operating expenses as low as possible. Even for these frugal organizations it may be advisable to try having food at board meetings. The foundation could still provide food at the meeting but rather than have the foundation pay for it, the board members simply pay their way individually. Another option is to have a potluck with each board member bringing a dish to share.
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