The Regional Traveler: What Happens When You Return Home Frequently During Assignments Many travelers take assignments significant distances from their home but there are some that journey shorter distances, traveling within a few hours’ drive. These assignments allow the traveler to stay close to home, spend time with family or attend to other priorities that preclude a long distance assignment. Most staffing contracts design tax free per diem payments for lodging and meals around a 7 day a week payment with the assumption that the traveler will be away from home overnight at the assignment location for the duration of the contract. This assumption creates some thorny tax issues for travelers that travel shorter distances and return home frequently – especially those that stay in hotels or only rent accommodations during work days. Before we explain how frequent returns home affect taxes, it may be good to discuss how per diem payments function. That will be the focus of this first part or the series. The Per Diem Payment – How it Functions In a perfect world, when an employee incurs travel related expenses for meals and lodging, they will submit their receipts to a designated individual who approves a reimbursement, or the employee has an expense account allowing them to use a corporate credit card which is reviewed at various intervals. When an operation has a large number of employees traveling, it can become an huge administrative task to track all the employee expenses. The IRS Allowance To reduce the […]

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