XV.   Per Diem Expenses

Documentary evidence is required for all lodging expenses plus other expenses over $75, unless per diem expenses are claimed. The tax deduction for entertainment  & meal expenses is limited to 50%. All expenses are subject to record keeping rules.

However for traveling in the USA per diem expenses may be claimed. These vary by locality, but the 2001 standard rate is $85 of which $55 was for lodging and $30 for meals, incidentals and entertainment. See IRS publication 1542 for details. Individuals related to employers including greater than 10% owners are precluded from using Per Diem Rates.

For foreign travel rates, they vary by locality. For example Per Diem Rates in Prague, Czech Republic effective July 1, 2002 is: Maximum - lodging $166, meals $54 and incidentals $13; that is a total of $233.

Essentially the expense has to be for business purposes. There are detailed rules for determining when the expense is regarded as personal or business.