Announcement

Collapse
No announcement yet.

Per Diem Contract Labor

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Per Diem Contract Labor

    Client hires temporary help for out of town events. Pays the help as contract labor and pays for their food via a per diem. Is this per diem deductible? Or is a per diem only deductible for employees?

    #2
    I would think if he adds it to their 1099 income it would be deductible as labor, otherwise no.
    In other words, a democratic government is the only one in which those who vote for a tax can escape the obligation to pay it.
    Alexis de Tocqueville

    Comment


      #3
      Do the contractors live in the event area (the contractors' Tax Home), or are the contractors also out-of-town?

      Comment


        #4
        Contractors live in taxpayers tax home area-travel with taxpayer to events. Taxpayer pays lodging and per diem. They didn't 1099 the contractors for the per diem. It seems all I read regarding per diem allowances refers to taxpayers and employees not subcontractors-hence the question.

        Comment


          #5
          Yes, the business can deduct the lodging and 50% of the meal Per Diem.

          Those are basically part of a "reimbursement" plan (see ยง1.62-2).




          Yes, an employer can have a Reimbursement Plan with an Independent Contractor. Generally, a Per Diem is part of an Accountable Plan, and unless specifically agreed otherwise, the employer is subject to the 50% limitation (it is not fully deductible as part of the payment to the contractor, and does not go on the 1099).

          https://www.irs.gov/publications/p46...blink100034152 (it is in the Regs somewhere, but is tricky to find).

          Comment


            #6
            the contractor could take 100% of the meals if they are meals eaten on the job site.
            Believe nothing you have not personally researched and verified.

            Comment


              #7
              Originally posted by taxea View Post
              the contractor could take 100% of the meals if they are meals eaten on the job site.
              Why would you pay for the contractors anything? Unless you are blurring the line between contractor and employee??

              Chris

              Comment

              Working...
              X