Publication 1542 which is available on the internet at irs.gov

While self-employed persons cannot use the high-low method, they may use other per diem rates to compute the amount of their business expense deduction for business meals and incidental expenses but not lodging , or for incidental expenses alone. Employees can no longer deduct their unreimbursed expenses due to the suspension of miscellaneous itemized deductions by the Tax Cuts and Jobs Act, so these other rates are effectively unavailable to them.

EBIA Comment: The per diem rules can greatly simplify the process of substantiating business travel expense amounts. If the amount of an allowance is deemed substantiated because it does not exceed the applicable limit, any unspent amounts do not have to be taxed or returned.

If an employer pays per diem allowances that exceed what is deemed substantiated, however, the employer must either treat the excess as taxable wages or require actual substantiation. If substantiation is required, any unsubstantiated portion of the allowance must be returned or treated as taxable wages.

Please try again later. No results could be found for the location you've entered. Rates for Alaska, Hawaii, U. Territories and Possessions are set by the Department of Defense. Rates for foreign countries are set by the State Department. Similarly, any payments which are more than the per diem rate will also be taxable.

The reimbursement piece is key. Remember that unreimbursed job expenses are currently not deductible. Those expenses include unreimbursed travel and mileage. That also means that the business standard mileage rate you'll find the rate here cannot be used to deduct unreimbursed employee travel expenses for the through tax years.

The IRS has clarified, however, that members of a reserve component of the Armed Forces of the United States, state or local government officials paid on a fee basis, and certain performing artists may still deduct unreimbursed employee travel expenses as an adjustment to income on the front page of the ; in other words, those folks can continue to use the business standard mileage rate.

For details, check out Notice downloads as a PDF. What about self-employed taxpayers? Self-employed taxpayers can still deduct business-related expenses. If your assignment is indefinite, you must include in your income any amounts you receive from your employer for living expenses, even if they are called travel allowances and you account to your employer for them.

You may be able to deduct the cost of relocating to your new tax home as a moving expense. See Publication for more information. You must determine whether your assignment is temporary or indefinite when you start work.

If you expect an assignment or job to last for 1 year or less, it is temporary unless there are facts and circumstances that indicate otherwise. An assignment or job that is initially temporary may become indefinite due to changed circumstances. A series of assignments to the same location, all for short periods but that together cover a long period, may be considered an indefinite assignment.

The following examples illustrate whether an assignment or job is temporary or indefinite. If you go back to your tax home from a temporary assignment on your days off, you are not considered away from home while you are in your hometown. You cannot deduct the cost of your meals and lodging there. However, you can deduct your travel expenses, including meals and lodging, while traveling between your temporary place of work and your tax home.

You can claim these expenses up to the amount it would have cost you to stay at your temporary place of work. If you keep your hotel room during your visit home, you can deduct the cost of your hotel room. In addition, you can deduct your expenses of returning home up to the amount you would have spent for meals had you stayed at your temporary place of work.

If you take a job that requires you to move, with the understanding that you will keep the job if your work is satisfactory during a probationary period, the job is indefinite. You cannot deduct any of your expenses for meals and lodging during the probationary period. Once you have determined that you are traveling away from your tax home, you can determine what travel expenses are deductible.

You can deduct ordinary and necessary expenses you have when you travel away from home on business. The type of expense you can deduct depends on the facts and your circumstances. When you travel away from home on business, you should keep records of all the expenses you have and any advances you receive from your employer.

You can use a log, diary, notebook, or any other written record to keep track of your expenses. If you have one expense that includes the costs of meals, entertainment, and other services such as lodging or transportation , you must allocate that expense between the cost of meals and entertainment and the cost of other services.

You must have a reasonable basis for making this allocation. For example, you must allocate your expenses if a hotel includes one or more meals in its room charge. If a spouse, dependent, or other individual goes with you or your employee on a business trip or to a business convention, you generally cannot deduct his or her travel expenses. It is necessary for you to stop for substantial sleep or rest to properly perform your duties while traveling away from home on business.

You cannot deduct expenses for meals that are lavish or extravagant. An expense is not considered lavish or extravagant if it is reasonable based on the facts and circumstances. Expenses will not be disallowed merely because they are more than a fixed dollar amount or take place at deluxe restaurants, hotels, nightclubs, or resorts. Both of these methods are explained below. If you use this method, you must keep records of your actual cost.

The set amount varies depending on where and when you travel. If you use the standard meal allowance, you still must keep records to prove the time, place, and business purpose of your travel.

Fees and tips given to porters, baggage carriers, bellhops, hotel maids, stewards or stewardesses and others on ships, and hotel servants in foreign countries,. Transportation between places of lodging or business and places where meals are taken, if suitable meals can be obtained at the temporary duty site, and.