SECTION 4. APPLICATION

.01 In general . A taxpayer filing an original return, under examination, in litigation, or making a refund claim, may use statistical sampling in connection with establishing, with respect to its income tax liability, the amount of the taxpayer’s substantiated expenses paid or incurred for meals and entertainment excepted from the 50% deduction disallowance of § 274(n)(1) by reason of § 274(n)(2)(A), (B), (C), (D), or (E) by following the procedures provided in Appendix A (Sampling Plan Standards), Appendix B (Sampling Documentation Standards), Appendix C (Technical Formulas), and (in the case of de minimis fringes) in paragraph 4.02 of this revenue procedure. .02 Additional procedures required for de minimis fringe benefits .

(1) Reimbursements under accountable plans . In conducting the study, expenses for meals and entertainment reimbursed by employers to employees under an accountable plan may not be treated as de minimis fringe benefits.

(2) Determination of frequency . To establish the amount of identified expenses that are excepted from § 274(n)(1) by reason of § 274(n)(2)(B), a taxpayer is required to determine the frequency with

26 CFR 601.105: Examination of returns and claims for refund, credit or abatement; determination of cor- rect tax liability. (Also Part I, §§ 132, 162, 274; 1.132–6.)

Rev. Proc. 2004–29