Per diem rates are raised by the IRS.

man holding a boardingpass, passport and luggage at an airport

Per diem rates are raised by the IRS.

The daily per diem rate for business travel to less expensive locations is $204 per day. $297 will be the highest rate.

The per diem rates will rise as of October 1, 2021, according to the Internal Revenue Service. The daily per diem rate for lower-cost business travel locations will be $204. The maximum rate is $297. The new rates will be in effect from October 1, 2022, to September 30, 2023.

Employees can be given per diem reimbursement instead of tracking specific expenses for lodging, meals, and ordinary incidental business expenses when they travel. The per diem allowances can then be claimed as business expenses on tax returns. Given that some regions of the United States have higher costs, per diem rates may change depending on the location of the trip. This method of high-low substantiation allows for more affordable rates.

Per diem rules further limit how much of the daily allowance can be used for meals. That amount is $64 per day for low-cost travel destinations and $74 per day for higher-cost locations. Allowable rates for meals and incidental expenses in the transportation industry are $69 per day in the United States and $74 in other countries.

The list of which cities and regions fall under the categories of high-cost or low-cost is updated on a regular basis and is available here.

The tax laws are very complex. Our short blog articles cannot cover in full all the nuances of the rules. Your specific facts may hold various opportunities and possible risks that only trained, experienced, and highly qualified tax specialists can spot. We encourage you to find such help, rather than trying to figure it all out on your own. Consider giving this marketplace a try by posting your project and signing up here.

If you are a licensed tax professional and are interested in helping others either part or full-time, or ad hoc, come on in! Happy to have you. Our marketplace has the full suite of tools to communicate with clients including compliance calendars, task and message management, and billing. You can also quickly connect to knowledgeable colleagues who can complement your services with the ones you do not provide. Register here

Picture of iFind Taxpro

iFind Taxpro

Ask a question

Data security and privacy are our topmost priorities. Your personal details will not be shared publicly.

Required fields are marked *