Per Diem pay is NOT non-taxable. It is not withheld if the sequence contains an out of base overnight - this is why you may have 2 colums in your end of month stub: TAFB W (withheld) & TAFB NW (not-withheld). Come tax time you have to report the total per diem you rec'd and you can either itemize receipts for trip expenses or use the GSA standard rates and subtract your expenses from your per diem payments to get the taxable amount.