The IRS in Notice 2017-54 provided updated special per diem effective for the period from October 1, 2017 to September 30, 2018. These special rates include the rate for the special transportation industry meals and incidental expenses (M&IE) rate, the rate for the incidentals-only deduction and the rates and list of high-cost localities for purposes of the high-low substantiation method.
The special transportation industry rates for 2017-2019 are $63 for any locality of travel in the continental United States and $68 for any locality of travel outside the continental United States. These rates are the same as applied in the prior year. The general rules for qualifying to use these rates and how to use them are found in Section 4.04 of Revenue Procedure 2011-47.
The incidentals only rate for 2017-2018 is set at $5. Again, this rate as the same as it was for the prior year. The provisions applicable to using this rate are found in Section 4.05 of Revenue Procedure 2011-47.
The high-low rates for 2017-2018, to be used in lieu of the general per diem substantiation method, are $284 for any high-cost locality and $191 for travel to any other locality within the continental United States, both representing very minor increases over the prior year. The portion of the above amounts treated as paid for meals are $68 for travel to a high-cost locality and $57 for any other location within the continental United States. This amount did not increase over the prior year.
Section 5.2 of the notice provides the 2017-2018 list of high-cost localities. Some localities are high-cost only for a portion of the year, with this fact noted in the listing. Section 5.3 provides a list of localities that were added and removed from the high cost list, as well as those where the time period during the year the high rate is applicable has been modified.