I am self employed consultant. I traveled to Japan in 2019. I am using Per Diem Rate to report travel expense, as shown in this table . The self-employed entity cannot use Per Diem for lodging. My question is that does the self employed's Per Diem policy include the Incidental expense? That is, should I use the M & IE Rate number directly, or I have to subtract the Incidental Expense from the M & IE Rate number before I use it? Thanks
@Anonymous , do you still need help on this ?
In general, IRS summary for such : is as follows : ( details are available here --> https://www.irs.gov/pub/irs-drop/rp-19-48.pdf :(
" IR-2019-190, November 26, 2019
WASHINGTON — The Internal Revenue Service today issued guidance for business travelers, updated to include changes resulting from the Tax Cuts and Jobs Act (TCJA).
Revenue Procedure 2019-48 (PDF), posted today on IRS.gov, updates the rules for using per diem rates to substantiate the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. Taxpayers are not required to use a method described in this revenue procedure and may instead substantiate actual allowable expenses provided they maintain adequate records.
Although TCJA suspended the miscellaneous itemized deduction that employees could take for non-reimbursed business expenses, self-employed individuals and certain employees, such as Armed Forces reservists, fee-basis state or local government officials, eligible educators, and qualified performing artists, that deduct unreimbursed expenses for travel away from home may still use per diem rates for meals and incidental expenses, or incidental expenses only.
The revenue procedure makes clear that TCJA amended prior rules to disallow a deduction for expenses for entertainment, amusement, or recreation paid or incurred after December 31, 2017. Otherwise allowable meal expenses remain deductible if the food and beverages are purchased separately from the entertainment, or if the cost of the food and beverages is stated separately from the cost of the entertainment.
The IRS annually issues guidance providing updated per diem rates; Notice 2019-55 (PDF) provides the rates that have been in effect since October 1, 2019."
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