Temporary Assignments & Per Diem Reimbursements

When an employee is sent to temporarily work at a location away from the home office, the contractor must pay for various travel, lodging, and incidental costs. In this type of situation, a contractor must determine what amounts are deductible to the company and what amounts (if any) may be taxable to the employee. This article will review the complex tax impacts of temporary work assignments to maximize the benefits to employers and employees. Basic Guidance What types of expenses are deductible as ordinary, necessary, and reasonable business travel expenses while traveling away from home? The IRS supplies the following list as basic guidance:1 Travel by airplane, train, bus, or car between the employee’s home and business destination. Fares for taxis or other types of transportation between the airport or train station and hotel, the hotel and the work location, and from one customer to another or from one place of business to another. Shipping of baggage and certain other… read more →