Client performs networking services in various states throughout the country. When he sends a crew out of town, he gives them $25 per day for meals. How would you account for this? Does he have to have receipts to take the deduction?
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Your client is giving his employees a per diem for their meals.
TTB, page 8-12, "Per diem is the allowance for travel, lodging, meals and incidental expenses. An employer can reimburse employees under an accountable plan based on travel days, miles, or some other fixed allowance. The employee is considered to have accounted to the employer the amount of the expense that does not exceed the rates established by the federal government. By using a per diem allowance, the employee is not required to submit receipts to the employer to meet the accountable plan rules. However, employees are still required to substantiate the time, place, and business purpose of a trip."
TTB, page 8-3 lists the various per diem rates for meals depending on the location of travel. -
Thanks for the reply. Now this would not be subject to the 50% limitations... Correct? For some reason, the last preparer limited the taxpayers deduction.Comment
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Jiggers
Per diem payments for meals is limited to 50%.Jiggers, EAComment
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