IRS SPECIAL PER DIEM TAX RATES
November 1, 2022 - Douglas Myser
IRS special per diem tax rates. Every year the IRS comes out with new Per Diem tax rates that businesses can use to lower the taxable income they have, by lowering their taxable income. Yet in practice, many self employed business owners make the mistake of not keeping track of these expenses. You can buy a manual to keep with you to track these expenses, or Apps are now available to keep track of them on your smart phone. This special Per Diem is taking into consideration the impact that the Ukraine War has had on the price of fuel, and its subsequent impact on industries that have fuel costs. IRS special per diem tax rates.
Revenue Procedure 2019-48, 2019-51 I.R.B. 1392, provides rules for using a per diem rate to substantiate, under code section 274 (d) of the IRS code and section 1.274-5 of the Income Tax Regulations, the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. The special M&IE rates for taxpayers in the transportation industry are $69 for any locality of travel in the continental U.S. and $74 for any locality of travel outside the continental U.S. The rate for incidental expenses travel expenses only deduction is $5 per day.
For purposes of the high-low substantiation method, the per diem rates in lieu of the rates described in Notice 2021-52 are $297 for travel to any high cost locality and $204 for travel to any other locality within the Continental United States. The amount of the $297 high rate and $204 low rate that is treated as paid for meals for purposes of section 274 (n) is $74 to any high end locality and $64 for travel to any other locality within the Continental United States. The information is also available at the IRS website which is at IRS.GOV.