Per Diem Rates from the U.S. General Services Administration

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Rates are set by fiscal year, effective October 1 each year. Find current rates in the continental United States ("CONUS Rates").

Per Diem Rates

 2023 Earned Income Credit

For 2023 the maximum credit amount is $3,995 for one qualifying child, $6,604 for two qualifying children, $7,430 for three or more qualifying children, and $560 for taxpayers who have no qualifying child. The phaseout ranges for the credit have been adjusted for inflation. The excessive investment income limit is $11,000.

2023 Child Tax Credit

For 2023, the maximum child tax credit for a child under age 17 is $2,000. The credit begins to phase out when modified adjustment gross income ((MAGI) exceeds $400,000 on a joint return or $200,000 for all other filers.

There is an additional child tax credit that can be claimed if the child tax credit otherwise allowed is limited by tax liability; the refundable amount may not exceed $1,600 per qualifying child.

The credit for other dependents is unchanged (i.e. not refundable and limited to $500 per dependent).

• Business Travel:
  • 65.5 cents per mile
• Medical and moving for active military personnel:
  • 22 cents per mile
    • NOTE: This deduction only applies to members of the U.S. Armed Forces on active duty who move pursuant to a military order and incident to a permanent change of station.
• Charitable volunteers: 14 cents per mile (no change; set by statute)

Before the Tax Cut and Jobs Act (TCJA) of 2017, employees were able to claim a tax deduction for mileage between job locations and unreimbursed expenses. This deduction is no longer available. However, there are certain persons that may still claim a mileage deduction.

Here’s who may still claim a mileage deduction:

1. Small business owners.
2. Self-employed taxpayers who file Schedule C or Schedule F.
3. Independent contractors.
   1. For rideshare service providers, mileage from home to pick up the first passenger and the drive home after the last drop off are not deductible. Only the trips between the first business stop and the subsequent stops can be used for a claiming mileage deduction.
      However, if you have a home office that is your principal place of business, the miles from your home office to other business locations are deductible and miles from business locations back to your home office are deductible.
   2. Your principal place of business is where you either see customers, clients or where you maintain your books and records and do administrative work for your business (i.e. bookkeeping, filing papers, making sales calls, making business appointments, preparing business financial statements, etc.).
4. Certain types of employees, such as qualified performing artists, reservists in the armed forces, and fee-based government officials are eligible to claim mileage.
5. Individuals traveling for volunteer work or for medical appointments.

2023 First-year expensing (Section 179) and Bonus Depreciation

For qualifying property placed in service in 2023, first-year expensing is allowed up to a limit of $1,160,000. The limit begins to phase out if the total cost of qualifying property exceeds $2,890,000.

Section 179 Deduction Phase-out:

If the cost of qualifying property placed in service in 2023 exceeds $2,890,000, reduce the $1,160,000 expensing limit dollar-for-dollar for each dollar the cost of qualifying property exceeds $2,890,000 (but not below zero).

Example:, You place machinery in service during 2023 costing $2,950,000, the $1,160,000 deduction limit is reduced by $60,000 ($2,950,000 - $2,890,000) which is entered on Form 4562 in Part 1, line 5 (Dollar limitation for tax year).

If the cost of the property was $4,050,000 or more, no first-year expensing deduction would be allowed for 2023 because it would be completely phased out ($4,050,000 - 2,890,000) = $1,160,000 expensing limit.

2023 Bonus Depreciation (Section 168(k):

Bonus depreciation is an additional first-year depreciation allowance equal to a set percentage of the adjusted basis of eligible property. The percentage for bonus depreciation for 2023 is 80%. Bonus depreciation is fully deductible for alternative minimum tax purposes; no adjustment is required.

Bonus depreciation cannot be claimed for property that must be depreciated under the ADS straight line method (i.e. listed property used 50% or less for business must be depreciated under ADS). (ADS stands for Alternative Depreciation System.)

Bonus depreciation is also called a Section 168(k) allowance and a special depreciation allowance and can be claimed in addition to any first-year-expensing, depending on the cost of the property. In figuring adjusted basis for purposes of bonus depreciation, any first-year expensing deduction is taken into account first. Then, you figure bonus depreciation on the depreciable cost (business portion) of the property minus the first-year expensing allowance.

You're not required to use bonus depreciation and have the option of electing out of its use. The election is made on a per-asset-class basis. For example, you can opt out of bonus depreciation for all five-year property while claiming it for seven-year property. To elect out of using bonus depreciation, attach a statement to your return specifying the class of property for which the election not to claim additional depreciation is being made.