Per diem Calculations

[FlyinGuy]

Now that it is time to start thinking about those pesky taxes, I wanted to start the topic on per diem calculations. I do my own taxes and it seems like I have to learn how to do this again each year (my ADD). So with that said....can some of you tax gurus run down the way to calculate per diem for your taxes.

Thanks.

50-60 buck for some of these online calculators seems steep for something that I can do myself.

 

[AdlerDriver]

50-60 buck for some of these online calculators seems steep for something that I can do myself.

I used to say the same thing but I broke down and gave Pro-diem a try a couple of years ago. They beat my calculations by a significant amount. Enough to easily pay for their services and still put extra money in my pocket. You'd think the math would be pretty black and white, but I guess they've broken the code on the grey areas. Their method is legal and approved by the IRS, so you just plug their numbers into your favorite tax prep software and scoop up the extra $$. Try it, you'll be happy.

If you do choose to go it alone, the method I've always used was:

Figure the government allowed daily per diem for each layover on your trips. Google will get you the domestic and international rates.

You can do it hour by hour for partial days or use 3/4 of a day as a standard as long as you're consistent. At Fedex, many of our am hub turn trips have 22-23 hours TAFB with a single layover somewhere. If the ¾ day convention (i.e. 18 hours) is used with those trips, the pilot would lose those 4-5 hours on each trip, so it would obviously be better to use a more meticulous method. I think that’s where Pro-diem makes the difference. Whole days are easy. Get a per trip figure for each trip and tally up your yearly total of government allowed per diem. Subtract your company paid per diem(assuming it's less than the gov't figure) and you get to deduct 80% of the difference as a business expense. That 80% is up from 70% as of 2008.

So a 4 day trip:
Day 1 - 1300 dep Home base to LAX
Day 2 - LAX-DFW
Day 3 - DFW-MIA
Day 4 - MIA-Home base

Assuming you’re a normal airline guy and you have some long first/last days and some short – you decide to use the ¾ day standard.

You get 3/4 of the LAX rate for day 1
Full DFW rate for day 2
Full MIA rate for day 3
3/4 MIA rate for day 4 since it was the last city you slept in.

Add ‘em up and get your total allowable per diem for that trip.
Hope that helps.

 

[gobyebye]

Use EZPERDIEM.COM. I just went back and ammended my last three years (always thought I made too much per diem to get any tax credit) and got a check for about $800 in additional refunds. Cost me $30 per year and about 3 hrs. of my time total.

 

[sstearns2]

I just refiled for 2007 to get $375 back from per diem.

Scott

 

[FNG320]

If you use FLICA at your company, they may also offer the following for $50:

[SIZE=+2]2009 Expense Report[/SIZE] [SIZE=+2]and[/SIZE] [SIZE=+2]Flight Log[/SIZE]
[SIZE=+2]available[/SIZE][SIZE=+1]Did you know...[/SIZE]

•Even if you were reimbursed an hourly per diem amount by your airline (for meals and incidental expenses), that amount may be substantially less than the allowance established by the IRS.

•You may claim the difference between what the IRS allows and what your airline reimburses you as an additional deduction which could significantly reduce your tax liability**.

Flightline's [SIZE=+1]2009 Expense Report[/SIZE] calculates the IRS allowable deduction. It is supported by a [SIZE=+1]Flight Log[/SIZE] which provides leg-by-leg details and an annual summary of your flight history. [SIZE=+1]2009 Expense Report[/SIZE]

•Displays your allowable expenses and summarizes deductions in an acceptable IRS format.
•Uses IRS Standard Expense Method, eliminating the need for receipts and record keeping.
•Documents all information required by the IRS to support your claimed expenses.

**Please note: Your individual savings will vary based on your flight history, filing status (married or single), tax bracket, etc. Your annual travel expenses (including meals, incidentals, uniforms, dry cleaning, etc.) must exceed 2% of your Adjusted Gross Income (AGI) to qualify as a deductible expense. If a printed version is requested, a fee of $10.00 (USD) will be charged for shipping and handling.

Flightline Customer Service/Technical Support800-659-9859
[email protected]


I haven't used it, but those that I have talked to say it is pretty good.

FNG

 

[Whine Lover]

Pro Diem / T. Watson / Your Own Calculations

What might make you choose one of the above methods... over the other, for your Annual Tax / Per Diem calculations?

Thanks,

YKW

 

[Tail Gunner Joe]

not worth the pennies

or ... none of the above

not worth the time nor the effort to calculate the difference between my per diem and the IRS per diem

 

[redflyer65]

Definitely worth the time. Your mileage may vary, but it's pretty simple.

 

[Whine Lover]

I should have mentioned...

With some exceptions, ALL of my time this past year was spent overseas....where I believe, there is a great enough disparity in per diem rates to make it worthwhile.

For instance Dubai/UAE is allowed at $526.00/day. I would receive $67.00 in per diem.

Quite a difference in a write off.


YKW

 

[AKAAB]

Old thread - new info.

The Flica Expense report does not include any calculation for day trips, only trips with layovers. It's a waste of money unless you want the log book part of the report.

 

[regionalcap]

The IRS does not allow day trips to count toward your deduction. I have never seen any other tax prep company include day trips.

 

[4.0atRIDDLE]

I used perdiemcalc.com this year. ezperdiem.com works well too. Both are cheaper than the flica report, it just takes a few minutes to enter your schedule.

 

[Fox-Tree]

I should have mentioned...

With some exceptions, ALL of my time this past year was spent overseas....where I believe, there is a great enough disparity in per diem rates to make it worthwhile.

For instance Dubai/UAE is allowed at $526.00/day. I would receive $67.00 in per diem.

Quite a difference in a write off.


YKW

Careful. You're using the maximum per diem rate for Dubai which includes lodging. Unless you are paying for your own hotels, you should be using the M&IE (meals and incidental expense) rate which was ~$186 for this month.

Still a pretty big difference between that and most company's daily per diem rates.

 

[Whine Lover]

Hmm...I'll have to go back and check that.

Thanks.

YKW

 

[Whine Lover]

YOU ARE CORRECT SIR!

I haven't done my per diem calcs. yet, just took a perfunctory glance at the rates when I made my original post....So, I stand corrected.

Yes, the rate of $186.00 per day would be used, and that is still a significant difference from the $67.00 I am paid in per diem.

Roughly calculated ( very roughly ) ....I should have $10-12,000 in additional write offs last year by doing the perdiem calculations.

So, I have that going for me. Which is good....


Thanks for the heads up on that.

YKW