Effective as of October 1st, the IRS has released their annual report of the updated per diem rates taxpayers may use for business and travel expenses. Used in the high-low substantiation method and to give taxpayers an idea of how much they can spend per day to leave them eligible for a deduction, the changed rates are as follows…
For the special meal and incidental expense rate, those working in the transportation industry have a $66 allowance while within the U.S., and a $71 per diem for travel outside of the U.S borders. Local travel, however, has an incidental expense deduction of only $5.
To set the limitations under the high-low substantiation method, travel to a high-cost area is set at a daily rate of $287, whereas a low-cost locality has a per diem of $195. Under those same two rates, a $71 allowance is given for meals in a high-cost locale, and $60 for meals in cheaper areas.
When no meal or incidental expense rate applies, the per diem for travel to any high-cost locality within the U.S is $71, and $60 for travel to low-cost locales.
Want to read the IRS release for yourself, or check which areas within the continental U.S are considered “high-cost”? Click here for the original notice, whereas our thanks goes out to Micael Cohn and this article for the summary research.
