What does multiple meals and incidental markets mean when the IRS defines per diem for trucking?
If you have learned about per diem from our other articles and webinars, you may wonder what we mean by the requirement of multiple “meals in incidentals markets” to pay per diem. Let’s look into this more.
Internal Revenue Procedure 2019-48 found here defines the transportation industry for per diem. On page 12 it reads as follows.
“(2) Transportation industry defined. For purposes of this section 4.04, an employee or self-employed individual is in the transportation industry only if the employee’s or self-employed individual’s work (a) is of the type that directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and (b) involves regularly traveling away from home and stopping during a single trip at localities with differing federal M&IE rates. For purposes of the preceding sentence, a payor must determine that an employee or a group of employees is in the transportation industry by using a method that is consistently applied and in accordance with reasonable business practice.”
M&IE is stated earlier in the rev proc as “the special transportation industry meal and incidental expenses rates”. So, the driver has to go to on a single trip that stops in markets with different meals and incidentals rates.
Well, that helps, sort of. How do we know which markets (metro areas, usually) have what rates? Fortunately, there is a link for that. Some entries change by time of year but they tell you that in the excel file. If you do not want to find that file or you have questions, reach out to us and we can talk through it with you.
Written By Mike Ritzema
With over 20 years of experience in entrepreneurship, management, business planning, financial analysis, software engineering, operations, and decision analysis, Mike has the breadth and depth of experience needed to quickly understand entrepreneurs’ businesses and craft the most suitable solutions.
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