More Guidance Needed on Business Expenses and Per Diem Employees

This is a Comment on the Internal Revenue Service (IRS) Proposed Rule: Meals and Entertainment Expenses under Section 274

Submitter Information

Submitter Name: Aundrea Reel

City: Southlake

Country: United States

State or Province: TX

Organization Name: Pro-Diem, Inc.

Submitter's Representative: President, CEO

• Docket ID: IRS-2020-0002

• Document Type: Public Submission

• Document Subtype: Public Comment

• Status: Posted

• Received Date: Feb 26, 2020

How are those that are paid a per diem in lieu of actual expenses that are subject to the D.O.T. hours of service limits affected.

Will they be able to use the CONUS and OCONUS rates for their deduction as before.

Example of this would be all of the pilots and flight attendants that are paid a small hourly pittance in per diem in lieu of actual expenses. They travel to many cities with different allowable rates. Receipts were not necessary and using the government rates was considered to be reasonable as it would be impossible to keep receipts (or even get them) and convert to USD based on exchange rates/day etc.

Their allowable deduction based on their travel (substantiated by Time, Date and Place on company provided flight logs) would then subtract the amount of non taxable per diem paid towards that allowance and then a D.O.T. % of 80% would be applied (on Form 2106).

The new proposal seems to indicate they can claim deduction under defination of ordinary and necessary, but what are the rules specifically for them?

Can you please use a pilot or flight attendant for an example? It is a huge industry and not being able to claim said expenses has been punitive.