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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 12181
Experience:  Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
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My question is about expenses. As a union construction member,

Customer Question

My question is about expenses.
As a union construction member, all my jobs are temporary: scheduled for less than a year...most less than nine months( only exceptions would be scheduled phase jobs where overall job lasts longer than one year, but no one phase is longer than one year).
Are my per diem checks supposed to be taxed in this scenario, or is this not taxable?
Thank you
Submitted: 1 year ago.
Category: Finance
Expert:  Megan C replied 1 year ago.
Thank you for your question, and thanks for using JustAnswer.com.

Whether or not your per diem is taxable or not depends on a few circumstances:

Per the IRS (CLICK HERE)

Per diem payments are not part of the employee’s wages if the payment is equal to or less than the federal per diem rate and the employer receives an expense report from the employee.

What does an expense report need to include?
The report must include:
• The business purpose of the trip,
• The date and place of the trip, and
• Receipts for lodging (if using the meals-only per diem rate).

The employee must file the expense report with the employer within a reasonable period of time (60 days). If any of these requirements are not met, the payment is taxable to the employee.

When are per diem payments taxable?

Payments will be taxable to the employee when any of these situations are true:
• No expense report is filed with the employer,
• The expense report filed does not include the date, time, place, amount and business purpose of the expense,
• A flat amount is given to the employee and no expense report is required, or
• Per diem is paid in excess of the allowable standard federal rate.

These per diem payments listed above would be treated as wages and employment taxes are due from the employer.


So, based on what you have shared - there's not enough information to determine if your per diem is taxable or not. If you have to file an expense report, and your per diem is under the federal per diem rate, then chances are good that your per diem is not taxable. However, if you are given a flat per diem without a requirement to file an expense report then your per diem is fully taxable.

Please let me know if you need further information. Thanks again for using JustAnswer.com and have a happy, and safe, 2013.

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You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.

Expert:  Megan C replied 1 year ago.
Thanks for allowing me the opportunity to help you. Please let me know if I can be of any further assistance to you in this matter. Also if you ever need anything else in the future please Simply enter "MyVirtualCPA" in the subject of your question Thanks again for being a JustAnswer customer
Customer: replied 1 year ago.
The date and place, as well as the reason for travel is information provided to employer. Also, the per diem paid is less than federal rate. Does this still result in taxes needing to be taken?
Expert:  Megan C replied 1 year ago.
Thank you for your follow up. If you do not provide the employer with an expense report, then this amount is taxable to you. I'm sorry if this is not optimal in your situation.

Thanks again for using JustAnswer.com and please let me know if you have any further questions about this matter.

** Please take a moment to rate my response as "Excellent" so that I may be compensated for assisting you today. Please let me know if my assistance was anything less than "OK Service", as I am compensated based on whether or not I have assisted you with your issue. If you need further clarifications, PLEASE WAIT TO RATE MY ANSWER UNTIL AFTER RECEIVING FOLLOW UP FROM ME. If I receive anything less than OK Service, I do not get paid. Thank you for your kind understanding in this matter. If you have difficulties rating, then simply respond stating that you are having difficulties rating and thank me for my excellent, good, or ok service and we can get the rating applied by the site*
You should be aware that your question, as with most tax questions, can never really be answered completely...addressing all the permutations; that is because of the many assumptions that have to be made I have done my best to determine what I think you are asking and answering it in the most direct and understandable manner possible. If, however, after reviewing the questions, you have any uncertainties or further questions, please do not hesitate to ask.

Expert:  Megan C replied 1 year ago.
Thanks for allowing me the opportunity to help you. Please let me know if I can be of any further assistance to you in this matter. Also if you ever need anything else in the future please Simply enter "MyVirtualCPA" in the subject of your question Thanks again for being a JustAnswer customer

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