I've heard of people using the Standard Meal Allowance for Transportation Workers, but have never used it myself.

Being the pessimist that I am, I thought that an employer's payment of per diem to an employee basically disallowed the use of this deduction by said employee. Just trying to educate myself here, taxes are Latin to me sometime.

Just curious to see what others in the community have used as well.

 

This is from tax year 2011 guidance:
http://www.irs.gov/pub/irs-pdf/p463.pdf

Special rate for transportation workers. **You can use a special standard meal allowance if you work in the transportation industry. You are in the transportation industry if your work:
Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and

Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates.

If this applies to you, you can claim a standard meal allowance of $59 a day ($65 for travel outside the continental United States).
**Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area where you stop for sleep or rest. If you choose to use the special rate for any trip, you must use the special rate (and not use the regular standard meal allowance rates) for all trips you take that year.
Travel for days you depart and return. **For both the day you depart for and the day you return from a business trip, you must prorate the standard meal allowance (figure a reduced amount for each day). You can do so by one of two methods.
Method 1: You can claim 3/4 of the standard meal allowance.

Method 2: You can prorate using any method that you consistently apply and that is in accordance with reasonable business practice.

Example.

Jen is employed in New Orleans as a convention planner. In March, her employer sent her on a 3-day trip to Washington, DC, to attend a planning seminar. She left her home in New Orleans at 10 a.m. on Wednesday and arrived in Washington, DC, at 5:30 p.m. After spending two nights there, she flew back to New Orleans on Friday and arrived back home at 8:00 p.m. Jen's employer gave her a flat amount to cover her expenses and included it with her wages.

Under Method 1, Jen can claim 2½ days of the standard meal allowance for Washington, DC: 3/4 of the daily rate for Wednesday and Friday (the days she departed and returned), and the full daily rate for Thursday.

Under Method 2, Jen could also use any method that she applies consistently and that is in accordance with reasonable business practice. For example, she could claim 3 days of the standard meal allowance even though a federal employee would have to use Method 1 and be limited to only 2½ days.

 

Essentially, you can use the special rate or choose to calculate each local meal allowance based on each over night.

You can deduct anything that is above and beyond what your employer provides.

IE if you get $35/day per diem, but the standard meal allowance for the city you were overnighting in was $47, you can deduct the $12 difference. (or if applying the standard special rate for transportation workers, you can deduct $59 minus the $35 your employer paid you)

Depending on where you travel, the standard rate might be better or taking the time to figure out each local allowance might be better. (For example the standard allowance for meals in New York in 2013 is $71/day, so if you did a lot of NYC overnights, it might be better to calculate all of your overnights instead of using the standard special rate.)

Whichever method you choose though, you have to use for the entire year, so if you use the special rate, it applies to all of your overnights. If you choose to determine each individual locality you have to do it for all of your overnights.

 

Thanks FlyerJ,

Had a captain recommend using this,
Internal Revenue Bulletin - October 17, 2011 - Notice 2011-81

Sounds similar to what you posted, but I'm still hashing through it all.
Kind of sick of using CPAs so I'm going to H & R block this year. Just want to educate myself a little more prior to going in.

 

I've used Pro Diem the last couple years. For a bunch of airlines, you can log into your scheduling web site through them, they'll download your last year's schedule and crunch the numbers, city by city, hour by hour. Or you can print out your schedule and mail it to them. Given that the government says it costs $159 a day to eat in Nagoya, my per diem is $57.60, and they charge $59 for their service (yes, it's a deduction on the following year's taxes), they're paid for in one 14 hour layover.

 

^^^^^^^^^^^^^^^
This. I've used ProDiem the last several years - WELL WORTH WHILE!

Previously I'd used standard rate, according to my tax guy you can deduct the difference between the allowance and what you received in per diem. ProDiem easily pays for itself.

 

We must have flown with the same captain.

I'm curious as well. I don't think I go to work enough to get any benefit out of paying someone for the information. So I'm curious about the standard ME&I.

 

Great tip. Thanks!