Per diem expenses

[TAX]

Client, sole owner of S corp, is a consultant.

Home office is in Illinois. Takes assignment in different states. Thus he is on a travel basis.

He can deduct actual expenses of meals, apartment rent etc. But can he deduct per diem expenses, instead of actual expenses, from federal rate table?

[rgtaxservice]

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He can deduct actual expenses of meals, apartment rent etc. But can he deduct per diem expenses, instead of actual expenses, from federal rate table?

His handling of his expenses depends on the nature of your question? When you say 'He', do you mean 'he' the employee, or 'he' the S-Corp employer?

This is turn leads to 'who' paid the expenses. The employee out of pocket or the S-Corp through an expense plan (accountable or not accountable).

If the employee paid the expenses out pocket without any plan - use per diem for ME&I and actual lodging.

For employers - the per diem is not taken - it's just a guideline as to the maximum allowable deductable expenses. In addition, if the S-Corp reimbursed the employee, the nature of the plan (accountable or unaccountable) will dictate whether the reimbursement is included in wages and the expenses are deducted by the employee or S-Corp.

Not enough information to provide any definitive answer.

[TAX]

His handling of his expenses depends on the nature of your question? When you say 'He', do you mean 'he' the employee, or 'he' the S-Corp employer?

This is turn leads to 'who' paid the expenses. The employee out of pocket or the S-Corp through an expense plan (accountable or not accountable).

If the employee paid the expenses out pocket without any plan - use per diem for ME&I and actual lodging.

For employers - the per diem is not taken - it's just a guideline as to the maximum allowable deductable expenses. In addition, if the S-Corp reimbursed the employee, the nature of the plan (accountable or unaccountable) will dictate whether the reimbursement is included in wages and the expenses are deducted by the employee or S-Corp.

Not enough information to provide any definitive answer.

Here is more detail:

Scorp employer reimbursed under accountable plan to employee (himself) by using per Diem.

Anyway, In my research I found that per Diem cannot be used for more than 10% owner. Is it true?

Reimbursement was made under accountable plan and excess returned:

(1) It is not taxable to employee and does not go on W-2
(2) S corp can deduct 50% of it.
(3) Hotel - Actual cost