How Per Diem works now

Look.

Either you take the standard deduction (I can not as I have other interests) or you have to itemize for all, pay close attention, all of your income.

Once you have to start itemizing you have the ability to claim travel expenses. Once I have a total AGI I use my total allowable deductions. There is no segregation of what income goes with which deduction. It does not work that way.

They did not remove the language allowing for unreimbursed deductions. They removed the reporting factor for most w-2 employees. If they had removed the deduction companies could not by law pay part of your wages as unreimbursed nontaxable wage.

If your tax guy is telling you different go get a better one. Hell I even ran it by the IRS call in line and they said it was allowable so long as I had other inputs on the schedule c. It could not be used solely to report per diem.

Now as before anyone wanting to know real world what can be done. Quit listening to message board accountants, for ####s sake do not listen to Kevin Rutherford. Go get a tax attorney, and ask them specifically about it. H&R Block is not a tax attorney. That is a minimum wage goomba.

 

You are looking at it backwards. It does not prohibit nontaxable unreimbursed business expenses. If it did companies could not do it either.

However it stops you from using form 2106. However if you have to itemize any part of your income you can not take the standard deduction. You can not take it on one part and itemize another.
I have to use form 1040 schedule c.

If you look at that form you will see the section 1 part 1 line 1 you have to enter your income. All of your income including w2 earnings. There is no separate break out of "well this part is w2 and this part is services , and this part is sales".

One line, one box for total amount.

I do not file a 1040a or EZ as a solely w2 employee person should.

 

Okie dokie.

 

It’s very simple 06Driver. Have a cpa provide you with instructions from IRS that says a taxpayer who only has W2 income can file a Form 2106 WITHOUT defrauding the IRS.

Once this is done we can all shut up. And FWIW, I really wish you would because for me, the ability to itemize meal and typical hotel expenses still exceeds the new higher standard deduction

 

No if you only have w2 income you can not because there is no 2106 anymore. Well until 2026(?) when the recent changes expire and we go back to the old law(Yeah right like Washington is down buying votes with this crap)

 

You can deduct anything you want to, when you file your taxes.

But in order to survive an IRS audit you have to prove the business justification for the expense. A copy of your logs won't justify a per diem deduduction for your eBay business ... It'll hang you.

Taking a $15k ME&I deduction against a $1500 eBay business is just screaming audit me.

 

Okie dukie. This was asked and answered. Go look section 1 line 1 on schedule c.