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Per Diem Deduction

What is the per diem deduction?

Per Diem Deduction is actually a misnomer that pertains to airline pilot tax preparation and flight attendant tax preparation. A more correct name for per diem deduction would be meal expenses and incidental expenses tax deduction.  The term "Per Diem Deduction" is not a term that pilots and flight attendants will find in the tax code, yet this term describes a very lucrative tax write-off for flight crews.

Essentially, the per diem deduction is a method that can be used by flight crewmembers to account for their meals and incidental expenses (M&IE) in lieu of keeping records and receipts.  It provides a much easier and more lucrative tax deduction for flight crewmembers than an actual cost meal deduction approach would.

How does the per diem deduction work?

The per diem deduction uses CONUS and OCONUS per diem rates to come up with an allowable value for what a flight crew member spends on meals and incidental expenses while on airline job related travel

The simplest way to calculate the per diem deduction is to use a per diem calculator.  A per diem calculator should link per diem rates for each airport location and time, then calculate the deduction according to specific rules set forth in IRS Publication 463.

Does the the per diem deduction imply that pilots and flight attendants deduct the per diem they were paid?

The phrase per diem deduction can also be a bit confusing because it sounds like per diem is being deducted. 

It isn't.

Per diem from a flight crewmember's employer simply reimburses the crewmember for their meals.  If the crewmember receives less per diem reimbursement than the M&IE expenses, then the flight crewmember should be able to take advantage of the per diem deduction if he or she itemizes.


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