Crew per diem and meals: five separate questions

Per diem is not one thing. Whether a personal deduction exists at all, the percentage limit that applies to meals, how an amount is proved, a locality figure, and what an employer pays you are five separate questions, and mixing them up is where crew tax advice usually goes wrong.

We hold no dollars-per-day figure for this vertical. We have not finished reading the notice that publishes those amounts, so we state none, and we do not borrow one from anywhere else.

What the rules say

Meals and the per diem line

Section 274(d) conditions the allowance of travel expenses on substantiation, and the regulations under it set out how an amount is proved. A method of proof is separate from the percentage limitation and separate from any dollars-per-day figure. No dollars-per-day figure has been retrieved in this vertical.

Meals and the per diem line — Only once a tax home is established

Section 274(n)(1) limits the amount allowable for an expense for food or beverages to 50 percent of what would otherwise be allowable. It limits an amount that is already allowable; it does not make an amount allowable.

What your employer pays you back for

What your employer pays you back for — If the law treats you as an employee

Section 62(c) provides that an arrangement is in no event treated as a reimbursement or other expense allowance arrangement if it does not require the employee to substantiate covered expenses to the person providing the reimbursement, or if it lets the employee retain amounts in excess of the substantiated expenses. Regulation 1.62-2 carries the accountable and nonaccountable structure. The consequences set by those regulations are not encoded here.

An allowance an employer pays for time spent away from base is a payment by the employer and a characterisation question under section 62. It is not a personal deduction, and its presence says nothing about whether any personal deduction exists. For an employee, that separate question is governed by the disallowance of miscellaneous itemized deductions.

Proving it later

Travel, meal and lodging expenses are subject to the substantiation requirement in section 274(d) and the regulations under it. Records that establish where the work was performed, which periods were spent away from the tax home, and what an employer paid or reimbursed, are the records those provisions turn on. No specific record format is stated by the retrieved authority.

What we are not saying here

Still being read

These are the questions we have not finished reading the authority for. They stay listed here until we have, and until then we do not state an answer.

Where this comes from

Every statement above comes from one of these. Each link goes to the official text, with the body that issued it and the date we read it.

What seat do you work in?

What are you trying to figure out?