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I don't really follow what you are suggesting. What would suddenly make them taxable? And, the IRS would tax employees because their employer pays for dinner? As in, it qualifies as income, somehow?

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If your employer gives you goods and services, that may qualify as a taxable benefit. It is basically income. The point being so that the government still gets its share even if the company pays its employees in free stuff instead of money.

Why that would change based on time of day, I don't know, but tax rules are complicated around this sort of stuff.

My former employer reimbursed our lunch as taxable income for this reason.

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