Carpe per Diem!
Friday, September 30, 2011 at 4:20PM
Tiffany Davis in Bookkeeping Tips, Great Links, Resources

Per diem is the allowance for lodging (excluding taxes), meals and incidental expenses for travel within the 48 continental US states. The allowance is typically elected on an annual basis and allows employees to be reimbursed without having the reimbursement added as taxable icome on their W-2. The amount established is the maximum a business can give it's employees without the allowance being treated as taxable income. The per diem rate attempts to simplify the expense reimbursement process for businesses and employees.

The Internal Revenue Service uses the per diem rates established by the General Services Administration (GSA) at

Rates Change October 1 Every Year

Per Diem rates are established for destinations within the Continental US and change annually on October 1.  Occasionally rates will be updated mid-year as the GSA makes that determination.  Rates are established for lodging and meals with incidental travel expenses. The Meals and Incidental per diem rate is typically used when there is an overnight stay involved. For the first and last day of travel the meals rate is calculated at 75 percent.

The Meals and Incidental travel per diem rate is intended to include:

A. Fees and tips given to porters, baggage carriers, bellhops, hotel maids, stewards or stewardesses and others on ships, and hotel servants in foreign countries. 
B. Transportation between places of lodging or business and places where meals are taken, if suitable meals cannot be obtained at the temporary duty site.

For more information about Per Diem rates:

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