Every year IRS releases a Revenue Procedure outlining the rules for paying Meal & Lodging Per Diems or claiming a deduction for these. The Revenue Procedure also provides us with the special Meal Per Diem allowed for the Transportation Industry. Part of the Revenue Procedure also gives us a High/Low option that can be used by employers as an alternative to using the tables based on actual cities.
During the summer of 2010 IRS asked for comments from taxpayers and tax practitioners regarding the High/Low option. After receiving NO COMMENTS at all, IRS has decided to no longer accept the High/Low option, presumably as of October 1, 2011, since October 1st is the day the amounts have changed each year. IRS further announced it would issue a Revenue Procedure this year with the rules for Meals and Lodging per Diems and future Revenue Procedures would not be issued unless the rules change. IRS will continue publishing an annual notice for the special transportation rate.
We expect IRS to release the Revenue Procedure for 2011 sometime within the next two months and we will produce a summary at that point. Please contact us if you need any assistance today.