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simple tax question

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cougarblue

Well-known member
Joined
Sep 9, 2005
Posts
58
ok Ive got a simple per diem question that i need some help with!

If I have 40 4-day trips, I take the standard deduction of $52 (i think thats what it is) and was paid 4000 ntax perdiem. what is the actual deduction?

would you also include how you came up with your answer. Thanks
 
The IRS language states that you have to use a "consistent" method to calculate your per-diem. I also used the $52 figure (dont know if it is right). Then I only multiplied by the number of hotels I stayed in (4 day trip = 3 nights). then multiply by 52 and in your case I got $6240. subtract the 4000 they paid you and you come up with a 2240 deduction.

If you want to get closer to an actual number take that extra day that you subtracted from the four day and multiply it by half of the IRS $52 standard. In your case 40 X 26 = 1040 then add that to your 6240 and get 7280.....Subtract the 4000 they paid you and use a 3280 deduction.

I am not an accountant and have done this method for four years now without incident. but from what I read in the tax code and from talking to other pilots about this i think the key is being consistant from year to year....you dont want to raise any flags on your return by having big differences from year to year.

Hope this helps....cheers
 
you can also use the specific M&I rates for individual cities, taken from the IRS chart. Most big cities will be more than $52.
 
The IRS language states that you have to use a "consistent" method to calculate your per-diem. I also used the $52 figure (dont know if it is right). Then I only multiplied by the number of hotels I stayed in (4 day trip = 3 nights). then multiply by 52 and in your case I got $6240. subtract the 4000 they paid you and you come up with a 2240 deduction.

If you want to get closer to an actual number take that extra day that you subtracted from the four day and multiply it by half of the IRS $52 standard. In your case 40 X 26 = 1040 then add that to your 6240 and get 7280.....Subtract the 4000 they paid you and use a 3280 deduction.

I am not an accountant and have done this method for four years now without incident. but from what I read in the tax code and from talking to other pilots about this i think the key is being consistant from year to year....you dont want to raise any flags on your return by having big differences from year to year.

Hope this helps....cheers

Remember..you can only claim 80% of the difference.
 
are you sure it is 80% ? That is the question I was going to post. I know you can't claim the entire difference but I thought it was 75%. Perhaps it got raised of I was using the wrong # all along.

Thanks for any insight
 
It was 75% in the past, this year it was raised to 80% for transportation industry workers.
 
ezperdiem.com will figure it all out for you for like 29 bucks.
 
If you use Turbo Tax, does it calculate the 80% difference for you????
Yes.

It is figured while completing Form 2106 for business expenses.

TurboTax will ask you for your allowable M&IE amount. Which you will have to figure in what ever way you like. i.e. the standard $52 / night or each individual overnight city. It will then ask for any amount that you were paid by your employer. TurboTax will calculate the difference and then allow the 80% deduction.

It really isn't that complicated.
 
So how would you compute a 4 day trip....3 nights at $52. Or do you do 2 full days @ 52, then partial days for the first and the fourth day....
 

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