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Per Diem Payment Questions
Posted on 3/15/16 at 3:43 pm
Posted on 3/15/16 at 3:43 pm
My business is exploring per diems as we are getting more and more out of town work. We've always had to have the employee keep all his receipts and then when they get back in town, a war starts over reimbursements. I'm trying to get it switched over to a per diem system to avoid this headache and waste of time.
I have friends that go out of town for small time work and get perdiem checks. One in particular claims he gets a 30 dollar flat payment per day. Another guy (worked for a big energy company)says he got whatever the federal recommended rates say for that location (usually like 50-70 bucks). However, out of the 4 people I talked to, none of them had to keep an expense record. It appears by law, that the employee should be getting taxed on the payment if they don't file an expense report. However, the 4 people I spoke to all said they received a separate check with the flat amount promised, and did not believe the amount was added to their w2. Are these companies just eating all of the taxes themselves, not reporting it, or am I reading these laws incorrectly.
Have any of you gotten per diems? How were they handled?
I have friends that go out of town for small time work and get perdiem checks. One in particular claims he gets a 30 dollar flat payment per day. Another guy (worked for a big energy company)says he got whatever the federal recommended rates say for that location (usually like 50-70 bucks). However, out of the 4 people I talked to, none of them had to keep an expense record. It appears by law, that the employee should be getting taxed on the payment if they don't file an expense report. However, the 4 people I spoke to all said they received a separate check with the flat amount promised, and did not believe the amount was added to their w2. Are these companies just eating all of the taxes themselves, not reporting it, or am I reading these laws incorrectly.
Have any of you gotten per diems? How were they handled?
This post was edited on 3/15/16 at 5:13 pm
22
Posted on 3/15/16 at 3:45 pm to Pendulum
try to get this moved to money board, you'll find more help there
Posted on 3/15/16 at 3:46 pm to Pendulum
I got 125$ a day for a week the one time work made me travel but I think 50-70 a day would still be fair.
Posted on 3/15/16 at 3:48 pm to Pendulum
I get per diem when I travel for work. ,it's all based on standard of living rate for the city. In Indianapolis I get $61 a day. In some smaller towns it's only like $45 per day, but can be much higher if LA or NYC. I think there is a site that shows per diem rates.
I only furnish receipts for car, gas, and hotel. Nothing else.
I only furnish receipts for car, gas, and hotel. Nothing else.
This post was edited on 3/15/16 at 3:52 pm
Posted on 3/15/16 at 3:49 pm to Pendulum
I work for a large company. Our per diem is done in a company system and is then put on our paychecks. I guess it gets taxed, but have never really followed it that closely. Ours is $35/day except in a few cities.
Posted on 3/15/16 at 3:51 pm to yellowfin
In my experience per diem payments are considered business expenses and are not included in your taxable income.
We have different contracts that do both, either the IRS rate or flat rates such as $15 or $25/ day.
ETA; Typically the "middle rate" of the IRS rate is used, and hotels are expensed separately.
We have different contracts that do both, either the IRS rate or flat rates such as $15 or $25/ day.
ETA; Typically the "middle rate" of the IRS rate is used, and hotels are expensed separately.
This post was edited on 3/15/16 at 3:53 pm
Posted on 3/15/16 at 3:51 pm to kengel2
I though Per Diem didn't get taxed?
Posted on 3/15/16 at 3:53 pm to Pendulum
I get the flat federal per diem without expense reports. It is rolled into my W2 at the end of the year so yeah I pay taxes on it
Posted on 3/15/16 at 3:54 pm to CunningLinguist
Thanks for the feedback guys, helpful
Posted on 3/15/16 at 3:57 pm to Pendulum
Mine has never been taxed, and I don't think it is supposed to be.
The amount just depends...
$30-45 is normal IF the company pays for your hotel.
$100-150 if you pay for your own room.
Plus mileage if you don't have a company vehicle.
The amount just depends...
$30-45 is normal IF the company pays for your hotel.
$100-150 if you pay for your own room.
Plus mileage if you don't have a company vehicle.
Posted on 3/15/16 at 3:58 pm to Pendulum
My buddy, from BR, works in Iowa gets $100 day on a seperate check. Not taxed. Everyone who works those kind of jobs will till you per diem is where the make a lot of money.
Posted on 3/15/16 at 3:59 pm to Pendulum
I am in the industrial construction industry. Our per diems typically range from $75 per day to $150 per day depending on your rank with the company. You must also pay for your own rooms/rv sites with this per diem. If you want the company to pay for your hotel room, then per diem rates are typically around $35 per day for food, etc.
Our company does not require any sort of expense report. The money is paid out and that is the last you hear of it.
I am unsure how the taxes work, but I can tell you that taxes are not taken out of per diem checks themselves.
Our company does not require any sort of expense report. The money is paid out and that is the last you hear of it.
I am unsure how the taxes work, but I can tell you that taxes are not taken out of per diem checks themselves.
Posted on 3/15/16 at 4:00 pm to Pendulum
There is a standard per diem rate based on your location. It is adjusted for costs of living in a particular area I believe.
A flat rate per diem does not require expenses to be kept, recorded, tracked, etc. but it is still smart to do so.
Also, as far as taxing on per diem, it is only taxed if you are actually on or expected to be on a particular location for longer than 11-12 months. that location then becomes your tax home for the year, and the per diem is taxed as income. Anything less than 11 months is not taxable and your tax home does not change.
There are also other stipulations that cover any potential loopholes.
A flat rate per diem does not require expenses to be kept, recorded, tracked, etc. but it is still smart to do so.
Also, as far as taxing on per diem, it is only taxed if you are actually on or expected to be on a particular location for longer than 11-12 months. that location then becomes your tax home for the year, and the per diem is taxed as income. Anything less than 11 months is not taxable and your tax home does not change.
There are also other stipulations that cover any potential loopholes.
Posted on 3/15/16 at 4:01 pm to Pendulum
Per diem is a reimbursement for travel expenses so it shouldn't be taxable. Look up CONUS per diem rates and you will find a listing for most us cities. If it's not listed then There is a standard rate. CONUS includes meals and lodging. As said above check the money board for more details.
Posted on 3/15/16 at 4:02 pm to Pendulum
We pay our hands $90/day per diem. It does not go on their taxes. I believe the government limit is around $120 daily and it doesn't have to be taxed. Or something around that
Posted on 3/15/16 at 4:02 pm to Pendulum
quote:
However, the 4 people I spoke to all said they received a separate check with he flat amount promised, and did not believe the amount was added to their w2.
This is how my job does it.
To avoid the reimbursement argument, I've seen places do it where you get a set amount per meal(i.e. - $10/$20/$25) and you have to turn in receipts for each meal. If it's under, then you receive the amount you paid. If it's over than you just receive the rate for that meal.
Posted on 3/15/16 at 4:04 pm to Pendulum
I have a company credit card I use to expense hotel, car, fuel, and meals. We have a daily meal allowance of $55/day. If I exceed that on the card, it'll come out of my next paycheck.
Meals with clients are exempt from this.
Meals with clients are exempt from this.
Posted on 3/15/16 at 4:05 pm to Pendulum
Back when I did real work, per diem was tax free. And don't insult anyone with thirty dollars a day, unless you hate your employees.
Posted on 3/15/16 at 4:07 pm to Pendulum
When I was in the oilfield, my company gave us 100/day for labor wee, 125 for welded, ask 150 for foremans per day.
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