IRS Publishes Special Per Diem Rates for 2019-2020
Notice 2019-55; 2019-42 IRB 937
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Subject Areas/Tax Topics
- Jurisdictions
- Tax Analysts Document Number2019-36657
- Tax Analysts Electronic Citation2019 TNTF 187-322019 TPR 38-9
Superseded by Notice 2020-71
Supersedes Notice 2018-77
2019-2020 Special Per Diem Rates
SECTION 1. PURPOSE
This annual notice provides the 2019-2020 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.
SECTION 2. BACKGROUND
Rev. Proc. 2011-47, 2011-42 I.R.B. 520 (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. 2011-47 (or successor). Notice 2018-77, 2018-42 I.R.B. 601, provides the rates and list of high-cost localities for the period October 1, 2018, to September 30, 2019.
Section 3.02(3) of Rev. Proc. 2011-47 (or successor) provides that the term “incidental expenses” has the same meaning as in the Federal Travel Regulations, 41 C.F.R. 300-3.1, and that future changes to the definition of incidental expenses in the Federal Travel Regulations would be announced in the annual per diem notice. Subsequent to the publication of Rev. Proc. 2011-47, the General Services Administration published final regulations revising the definition of incidental expenses under the Federal Travel Regulations to include only fees and tips given to porters, baggage carriers, hotel staff, and staff on ships. Transportation between places of lodging or business and places where meals are taken, and the mailing cost of filing travel vouchers and paying employer-sponsored charge card billings, are no longer included in incidental expenses. Accordingly, taxpayers using the per diem rates may separately deduct, if permitted, or be reimbursed for transportation and mailing expenses.
SECTION 3. SPECIAL M&IE RATES FOR TRANSPORTATION INDUSTRY
The special M&IE rates for taxpayers in the transportation industry are $66 for any locality of travel in the continental United States (CONUS) and $71 for any locality of travel outside the continental United States (OCONUS). See section 4.04 of Rev. Proc. 2011-47 (or successor).
SECTION 4. RATE FOR INCIDENTAL EXPENSES ONLY DEDUCTION
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. 2011-47 (or successor).
SECTION 5. HIGH-LOW SUBSTANTIATION METHOD
1. Annual high-low rates. For purposes of the high-low substantiation method, the per diem rates in lieu of the rates described in Notice 2018-77 (the per diem substantiation method) are $297 for travel to any high-cost locality and $200 for travel to any other locality within CONUS. The amount of the $297 high rate and $200 low rate that is treated as paid for meals for purposes of § 274(n) is $71 for travel to any high-cost locality and $60 for travel to any other locality within CONUS. See section 5.02 of Rev. Proc. 2011-47 (or successor). The per diem rates in lieu of the rates described in Notice 2018-77 (the meal and incidental expenses only substantiation method) are $71 for travel to any high-cost locality and $60 for travel to any other locality within CONUS.
2. High-cost localities. The following localities have a federal per diem rate of $248 or more, and are high-cost localities for all of the calendar year or the portion of the calendar year specified in parentheses under the key city name.
Key city | County or other defined location |
---|---|
Arizona | |
Sedona | City Limits of Sedona |
California | |
Mill Valley/San Rafael/Novato (October 1-October 31 and June 1-September 30) | Marin |
Monterey (July 1-August 31) | Monterey |
Napa (October 1-November 30 and April 1-September 30) | Napa |
Oakland | Alameda |
San Francisco | San Francisco |
San Mateo/Foster City/Belmont | San Mateo |
Santa Barbara (July 1-August 31) | Santa Barbara |
Santa Monica | City limits of Santa Monica |
Sunnyvale/Palo Alto/San Jose | Santa Clara |
Colorado | |
Aspen (October 1-March 31 and June 1-September 30) | Pitkin |
Crested Butte/Gunnison (December 1-March 31) | Gunnison |
Denver/Aurora (October 1-October 31 and April 1-September 30) | Denver, Adams, Arapahoe, and Jefferson |
Grand Lake (December 1-March 31) | Grand |
Silverthorne/Breckenridge (December 1-March 31) | Summit |
Telluride | San Miguel |
Vail | Eagle |
Delaware | |
Lewes (July 1-August 31) | Sussex |
District of Columbia | |
Washington D.C. (also the cities of Alexandria, Falls Church, and Fairfax, and the counties of Arlington and Fairfax, in Virginia; and the counties of Montgomery and Prince George's in Maryland) (See also Maryland and Virginia) (October 1-June 30 and September 1-September 30) | |
Florida | |
Boca Raton/Delray Beach/Jupiter (December 1-April 30) | Palm Beach and Hendry |
Fort Lauderdale (January 1-April 30) | Broward |
Fort Meyers (February 1-March 31) | Lee |
Fort Walton Beach/De Funiak Springs (June 1-July 31) | Okaloosa and Walton |
Key West (October 1-July 31) | Monroe |
Miami (December 1-March 31) | Miami-Dade |
Naples (February 1-April 30) | Collier |
Vero Beach (December 1-April 30) | Indian River |
Georgia | |
Jekyll Island/Brunswick (March 1-July 31) | Glynn |
Illinois | |
Chicago (October 1-November 30 and April 1-September 30) | Cook and Lake |
Maine | |
Bar Harbor/Rockport (July 1-August 31) | Hancock and Knox |
Maryland | |
Ocean City (July 1-August 31) | Worcester |
Washington, DC Metro Area (October 1-June 30 and September 1-September 30) | Montgomery and Prince George’s |
Massachusetts | |
Boston/Cambridge (October 1-November 30 and March 1-September 30) | Suffolk, City of Cambridge |
Falmouth (July 1-August 31) | City limits of Falmouth |
Hyannis (July 1-August 31) | Barnstable less the city of Falmouth |
Martha's Vineyard (June 1-September 30) | Dukes |
Nantucket (June 1-September 30) | Nantucket |
Michigan | |
Petoskey (July 1-August 31) | Emmet |
Traverse City (July 1-August 31) | Grand Traverse |
Montana | |
Big Sky/West Yellowstone/Gardiner (June 1-September 30) | Gallatin and Park |
New Mexico | |
Carlsbad | Eddy |
New York | |
Lake Placid (July 1-August 31) | Essex |
New York City (October 1-December 31 and March 1-September 30) | Bronx, Kings, New York, Queens, and Richmond |
Oregon | |
Portland (October 1-October 31 and June 1-September 30) | Multnomah |
Seaside (July 1-August 31) | Clatsop |
Pennsylvania | |
Hershey (June 1-August 31) | Hershey |
Philadelphia (October 1-November 30 and September 1-September 30) | Philadelphia |
Rhode Island | |
Jamestown/Middletown/Newport (June 1-August 31) | Newport |
South Carolina | |
Charleston (October 1-October 31 and March 1-September 30) | Charleston, Berkeley, and Dorchester |
Tennessee | |
Nashville | Davidson |
Texas | |
Midland/Odessa | Midland, Andrews, Ector, and Martin |
Pecos | Reeves |
Utah | |
Park City (December 1-March 31) | Summit |
Virginia | |
Wallops Island (July 1-August 31) | Accomack |
Washington, DC Metro Area (October 1-June 30 and September 1-September 30) | Cities of Alexandria, Fairfax, and Falls Church; Counties of Arlington and Fairfax |
Washington | |
Seattle | King |
Vancouver (October 1-October 31 and June 1-September 30) | Clark, Cowlitz, and Skamania |
Wyoming | |
Cody (June 1-September 30) | Park |
Jackson/Pinedale (June 1-September 30) | Teton and Sublett |
3. Changes in high-cost localities. The list of high-cost localities in this notice differs from the list of high-cost localities in section 5 of Notice 2018-77.
a. The following localities have been added to the list of high-cost localities: Mill Valley/San Rafael/Novato, California; Crested Butte/Gunnison, Colorado; Petoskey, Michigan; Big Sky/West Yellowstone/Gardiner, Montana; Carlsbad, New Mexico; Nashville, Tennessee; Midland/Odessa, Texas.
b. The following localities have changed the portion of the year in which they are high-cost localities: Napa, California; Santa Barbara, California; Denver, Colorado; Vail, Colorado; Washington D.C., District of Columbia; Key West, Florida; Jekyll Island/Brunswick, Georgia; New York City, New York; Portland, Oregon; Philadelphia, Pennsylvania; Pecos, Texas; Vancouver, Washington; Jackson/Pinedale, Wyoming.
c. The following localities have been removed from the list of high-cost localities: Los Angeles, California; San Diego, California; Duluth, Minnesota; Moab, Utah; Virginia Beach, Virginia.
SECTION 6. EFFECTIVE DATE
This notice is effective for per diem allowances for lodging, meal and incidental expenses, or for meal and incidental expenses only, that are paid to any employee on or after October 1, 2019, for travel away from home on or after October 1, 2019. For purposes of computing the amount allowable as a deduction for travel away from home, this notice is effective for meal and incidental expenses or for incidental expenses only paid or incurred on or after October 1, 2019. See sections 4.06 and 5.04 of Rev. Proc. 2011-47 (or successor) for transition rules for the last 3 months of calendar year 2019.
SECTION 7. EFFECT ON OTHER DOCUMENTS
Notice 2018-77 is superseded.
DRAFTING INFORMATION
The principal author of this notice is Maxine Woo-Garcia of the Office of Associate Chief Counsel (Income Tax & Accounting). For further information regarding this notice contact Maxine Woo-Garcia at (202) 317-7005 (not a toll-free call).
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Subject Areas/Tax Topics
- Jurisdictions
- Tax Analysts Document Number2019-36657
- Tax Analysts Electronic Citation2019 TNTF 187-322019 TPR 38-9