The IRS just released guidance on the new business travel per diems that went into effect in October. The guidance is issued to help clarify the definition of incidental expenses as: fees and tips given to porters, baggage carriers, hotel staff and staff on ships. NOT included are Transportation between places of lodging, business and places where meals are taken.
1. Meals and incidental expense rates for those in the transportation industry are $66.00 per day in the continental United States and $71 per day for travel outside the continental United States.
2. Incidental expenses only deduction are $5.00 per day.
3. List of high cost locations for purpose of high-low substantiation method. Click on the list to see the High cost cities in the continental United States. The rate per day ranges from $200.00 per day to a high rate of $297 to cover meals. The rate for travel is $71.00 to a high cost location, $60.00 for travel to any other location in the continental United States. There are specific time windows associated with some of these areas, and if you are left wondering how to treat the travel requirements of your business, check with you accountant. If you need help, visit https://businesstaxprep.org. to be connected to a tax expert who can guide you on the changes in travel deductions.