2024-09-20
Taxpayers may use to the special rates substantiate the amount of expenses for lodging, meals, and incidental expenses when traveling away from home.
This annual notice provides the 2024-2025 special per diem rates for taxpayers to use in substantiating the amount of ordinary and necessary business expenses incurred while traveling away from home, specifically: (1) the special transportation industry meal
and incidental expenses (M&IE) rates; (2) the rate for the incidental expenses only deduction; and (3) the rates and list of high-cost localities for purposes of the high-low substantiation method.
Rev. Proc. 2019-48, 2019-51 I.R.B. 1392 (or successor), provides rules for using a per diem rate to substantiate, under § 274(d) of the Internal Revenue Code and § 1.274-5 of the Income Tax Regulations, the amount of ordinary and necessary business expenses paid or incurred while traveling away from home. Taxpayers using the rates and list of high-cost localities provided in this notice must comply with Rev. Proc. 2019-48 (or successor). Notice 2023-68, 2023-41 I.R.B. 1060, provides the rates and list of high-cost localities for the period October 1, 2023, to September 30, 2024.
The special M&IE rates for taxpayers in the transportation industry are $80 for any locality of travel in the continental United States (CONUS) and $86 for any locality of travel outside the continental United States (OCONUS). See section 4.04 of Rev. Proc.
2019-48 (or successor).
The rate for any CONUS or OCONUS locality of travel for the incidental expenses only deduction is $5 per day. See section 4.05 of Rev. Proc. 2019-48 (or successor).
Annual high-low rates. For purposes of the high-low substantiation method, the per diem rates in lieu of the rates described in Notice 2023-68 (the per diem substantiation method) are $319 for travel to any high-cost locality and $225 for travel to any other locality within CONUS. The amount of the $319 high rate and $225 low rate that is treated as paid for meals for purposes of § 274(n) is $86 for travel to any highcost locality and $74 for travel to any other locality within CONUS. See section 5.02 of Rev. Proc. 2019-48 (or successor). The per diem rates in lieu of the rates described in Notice 2023-68 (the meal and incidental expenses only substantiation method) are $86 for travel to any high-cost locality and $74 for travel to any other locality within CONUS.
High-cost localities. The Notice provides localities have a federal per diem rate of $272 or more, and are high-cost localities for the specified portion of the calendar year. The list of high-cost localities in this notice differs from the list of high-cost localities in section 5 of Notice 2023-68