The IRS has released the optional “high-low” per diem rates for lodging expenses and meals and incidental expenses (M&IE) that may be used instead of the General Services Administration’s “actual” per diem rates for travel to locations within the continental U.S. (CONUS), the special federal M&IE per diem rates applicable to the transportation industry, and the per diem rate for incidental expenses. The updated high-low rates apply for travel undertaken on or after October 1, 2023 [Notice 2023-68, 9-25-23].
The “high” rate for lodging expenses and M&IE increases to $309 (from $297) for travel to any high-cost locality, while the “low” rate increases to $214 (from $204) for travel to any other locality within CONUS. The rates for M&IE remain at $74 for high-cost localities and $64 for any other locality within CONUS.
Changes to High-Cost Localities
Notice 2023-68 contains an updated list of high-cost localities, which now includes Yosemite National Park, Calif.; Tampa/St. Petersburg, Fla.; Atlanta, Ga.; Missoula, Mont.; Saratoga Springs/Schenectady, N.Y.; Eugene/Florence, Ore.; and Montpelier, Vt.
The portions of the year for which some localities are considered high-cost has also been adjusted, and four localities have been removed from the list.
Transportation industry rates. The federal M&IE rates for the transportation industry remain at $69 for any locality of travel within CONUS and $74 for any locality of travel outside the continental U.S.
Incidental expenses. Instead of using actual expenses in computing the amount allowable as a deduction for ordinary and necessary incidental expenses paid or incurred for travel away from home, an employee or self-employed individual may use an amount computed at the rate of $5 (unchanged) per day for each calendar day (or partial day) he or she is away from home.
Courtesy of PyrollOrg