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

Search by city, state or ZIP code, or by clicking on the map. You can also use the new per diem tool to calculate trip allowances

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

Per Diem Rates

Audit Proofing Business-related Meal Expenses

---

Items You Need to Document

If you don't satisfy the IRS's substantiation rules, your deduction can be disallowed. Under the TCJA, beginning in 2018 and beyond, only the cost of meals and beverages are 50% deductible when entertaining for business purposes. For 2017 and prior years, 50% of the cost of meals and beverages, as well as other entertainment costs are deductible, such as tickets to sporting events and the theater.

Separately Stated Rule

For 2018 and beyond, when entertaining for business purposes, if you are provided with one bill for the cost of the entertainment, make sure the bill shows the cost of the meals and beverages separately from other costs. This is a requirement to get the meal/beverage deduction.

The key points to remember for 2018 and beyond and 2017 and prior years is this:

• For tax years 2018 and beyond, the cost of meals and beverages must be separately stated.
• For tax years 2017 and prior, the separately stated rule does not apply.

Document Entertainment Expenses:

The TCJA does not change IRS substantiation rules. The only difference for 2018 and beyond is that meals and beverages must be separately. Prior to 2018 there was no such requirement.

Two Types of Records to Keep

1. A record to record the following (whether in the form of a diary or computer log, or some other format):
   • Date and time of event
   • Cost of meals and beverages separately stated for tax years 2018 and beyond. For tax year 2017 and prior, this rule does not apply.
   • Place
   • Business purpose
   • Name of business associate(s)
   • Relationship of individual(s) (i.e. customer, client, potential customer, employee).
2. Receipts, itemized paid bills and other expenses of $75 or more. However, a receipt or statement for lodging is needed regardless of amount.

Accounting Considerations for 2018 and Beyond

Since only the cost of meals and beverages are deductible beginning 2018 under the Tax Cuts and Jobs Act (50% of the cost) and non-meal/beverage costs when entertaining are not deductible, your general ledger should segregate the cost of meals and beverages from other entertainment-related costs. Doing this will facilitate tax preparation and financial reporting.

What to do:

• Set up a separate account in your general ledger to accumulate the cost of meals and beverages when entertaining for business purposes.
• Set up a separate account to accumulate non-meal and beverage costs when entertaining for business purposes.

Entertaining at Home

For 2018, under the TCJA, you may only deduct the cost of meals and beverages when entertaining customers or clients at your home.

For tax years 2017 and prior, you may meal and beverage cost as well as non-meal/beverage costs when entertaining for business purposes. Make sure you document the business purpose and have all guests sign a guest register.

Keep a record showing:

• Date of entertainment
• Business purpose of entertainment
• For 2018 and beyond:
  • Meal and beverages costs must be separately stated
• For 2017 and prior years:
  • Meal and beverage costs do not have to be separately stated
• Guest register:
  • Name of guest (have them sign their name)
  • Business Affiliation (e.g., member, V.P. Finance, etc.)
  • Referred by

If non-business guests also attend, only deduct costs associated with business guests. Keep a record that shows the total cost for all guests. For 2018 and beyond, be sure to separately state the cost of meals and beverages.

Boost Your Credibility if Audited

You should have a guest register for people to sign in. Your guest register should include at least three columns:

1. One column for each guest to sign in
2. A second column where business guests may place a check mark
3. A third column where nonbusiness guests may place a check mark.

If audited, the IRS will see that you accounted for both business and nonbusiness guests separately and did not attempt to deduct costs related to nonbusiness guests.