n-19-55.pdf

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2019-2020 Special Per Diem Rates

Notice 2019-55

# SECTION 1. PURPOSE

This annual notice provides the 2019-2020 special per diem rates for taxpayers
to use in substantiating the amount of ordinary and necessary business expenses
incurred while traveling away from home, specifically (1) the special transportation
industry meal and incidental expenses (M&IE) rates, (2) the rate for the incidental
expenses only deduction, and (3) the rates and list of high-cost localities for purposes of
the high-low substantiation method.

# SECTION 2. BACKGROUND

Rev. Proc. 2011-47, 2011-42 I.R.B. 520 (or successor), provides rules for using a
per diem rate to substantiate, under § 274(d) of the Internal Revenue Code and
§ 1.274-5 of the Income Tax Regulations, the amount of ordinary and necessary
business expenses paid or incurred while traveling away from home. Taxpayers using
the rates and list of high-cost localities provided in this notice must comply with Rev.
Proc. 2011-47 (or successor). Notice 2018-77, 2018-42 I.R.B. 601, provides the rates
and list of high-cost localities for the period October 1, 2018, to September 30, 2019.

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Section 3.02(3) of Rev. Proc. 2011-47 (or successor) provides that the term
"incidental expenses" has the same meaning as in the Federal Travel Regulations, 41
C.F.R. 300-3.1, and that future changes to the definition of incidental expenses in the
Federal Travel Regulations would be announced in the annual per diem notice.
Subsequent to the publication of Rev. Proc. 2011-47, the General Services
Administration published final regulations revising the definition of incidental expenses
under the Federal Travel Regulations to include only fees and tips given to porters,
baggage carriers, hotel staff, and staff on ships. Transportation between places of
lodging or business and places where meals are taken, and the mailing cost of filing
travel vouchers and paying employer-sponsored charge card billings, are no longer
included in incidental expenses. Accordingly, taxpayers using the per diem rates may
separately deduct, if permitted, or be reimbursed for transportation and mailing
expenses.

# SECTION 3. SPECIAL M&IE RATES FOR TRANSPORTATION INDUSTRY

The special M&IE rates for taxpayers in the transportation industry are $66 for
any locality of travel in the continental United States (CONUS) and $71 for any locality
of travel outside the continental United States (OCONUS). See section 4.04 of Rev.
Proc. 2011-47 (or successor).

SECTION 4. RATE FOR INCIDENTAL EXPENSES ONLY DEDUCTION

The rate for any CONUS or OCONUS locality of travel for the incidental
expenses only deduction is $5 per day. See section 4.05 of Rev. Proc. 2011-47 (or
successor).

SECTION 5. HIGH-LOW SUBSTANTIATION METHOD

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1\. Annual high-low rates. For purposes of the high-low substantiation method, the
per diem rates in lieu of the rates described in Notice 2018-77 (the per diem
substantiation method) are $297 for travel to any high-cost locality and $200 for travel to
any other locality within CONUS. The amount of the $297 high rate and $200 low rate
that is treated as paid for meals for purposes of § 274(n) is $71 for travel to any high-
cost locality and $60 for travel to any other locality within CONUS. See section 5.02 of
Rev. Proc. 2011-47 (or successor). The per diem rates in lieu of the rates described in
Notice 2018-77 (the meal and incidental expenses only substantiation method) are $71
for travel to any high-cost locality and $60 for travel to any other locality within CONUS.
2\. High-cost localities. The following localities have a federal per diem rate of $248
or more, and are high-cost localities for all of the calendar year or the portion of the
calendar year specified in parentheses under the key city name.

Key city

County or other defined location

Arizona

Sedona

City Limits of Sedona

California

Mill Valley/San Rafael/Novato (October 1-October 31 and

Marin

June 1-September 30)

Monterey

Monterey

(July 1-August 31)

Napa

Napa

(October 1-November 30 and

April 1-September 30)

Oakland

Alameda

San Francisco

San Francisco

San Mateo/Foster City/Belmont

San Mateo

Santa Barbara

Santa Barbara

(July 1-August 31)

Santa Monica

City limits of Santa Monica

Sunnyvale/Palo Alto/San Jose

Santa Clara

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Colorado

Aspen (October 1-March 31 and June 1-September 30)

Pitkin

Crested Butte/Gunnison

Gunnison

(December 1-March 31)

Denver/Aurora

Denver, Adams, Arapahoe, and Jefferson

(October 1-October 31 and April 1-September 30)

Grand Lake

Grand

(December 1-March 31)

Silverthorne/Breckenridge (December 1-March 31)

Summit

Telluride

San Miguel

Vail

Eagle

Delaware

Lewes

Sussex

(July 1-August 31)

District of Columbia

Washington D.C. (also the cities of Alexandria, Falls Church, and Fairfax, and the
counties of Arlington and Fairfax, in Virginia; and the counties of Montgomery and
Prince George's in Maryland) (See also Maryland and Virginia)
(October 1-June 30
and September 1-September 30)

Florida

Boca Raton/Delray Beach/Jupiter (December 1-April 30)

Palm Beach and Hendry

Fort Lauderdale (January 1-April 30)

Broward

Fort Meyers

Lee

(February 1-March 31)

Fort Walton Beach/De Funiak Springs (June 1-July 31)

Okaloosa and Walton

Key West

Monroe

(October 1-July 31)

Miami

Miami-Dade

(December 1-March 31)

Naples

Collier

(February 1-April 30)

Vero Beach (December 1-April 30)

Indian River

Georgia

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Jekyll Island/Brunswick
(June 1-July 31)

Illinois
Chicago
(October 1-November 30 and
April 1-September 30)

Maine
Bar Harbor/Rockport
(July 1-August 31)

Maryland
Ocean City
(July 1-August 31)
Washington, DC Metro Area
(October 1-June 30
and September 1-September 30)

Massachusetts

Boston/Cambridge
(October 1-November 30 and
March 1-September 30)

Falmouth
(July 1-August 31)
Hyannis
(July 1-August 31)
Martha's Vineyard
(June 1-September 30)

Nantucket
(June 1-September 30)

Michigan
Petoskey
(July 1-August 31)
Traverse City
(July 1-August 31)

Montana
Big Sky/West Yellowstone/Gardiner
(June 1-September 30)

New Mexico
Carlsbad

New York

Glynn

Cook and Lake

Hancock and Knox

Worcester

Montgomery and Prince George's

Suffolk, City of Cambridge

City limits of Falmouth

Barnstable less the city of
Falmouth
Dukes

Nantucket

Emmet

Grand Traverse

Gallatin and Park

Eddy

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Lake Placid

Essex

(July 1-August 31)

New York City

Bronx, Kings, New York, Queens,

(October 1-December 31 and

and Richmond

March 1-September 30)

Oregon

Portland

Multnomah

(October 1-October 31 and

June 1-September 30)

Seaside

Clatsop

(July 1-August 31)

Pennsylvania

Hershey

Hershey

(June 1-August 31)

Philadelphia

Philadelphia

(October 1-November 30 and September 1-September 30)

Rhode Island

Jamestown/Middletown/Newport (June 1-August 31)

Newport

South Carolina

Charleston

Charleston, Berkeley, and

(October 1-October 31 and

Dorchester

March 1-September 30)

Tennessee

Nashville

Davidson

Texas

Midland/Odessa

Midland, Andrews, Ector, and Martin

Pecos

Reeves

Utah

Park City

Summit

(December 1-March 31)

Virginia

Wallops Island

Accomack

(July 1-August 31)

Washington, DC Metro Area

Cities of Alexandria, Fairfax, and

(October 1-June 30

Falls Church; Counties of

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and September 1-September 30)

Arlington and Fairfax

Washington
Seattle
Vancouver
(October 1-October 31 and
June 1-September 30)

King
Clark, Cowlitz, and Skamania

Wyoming
Cody
(June 1-September 30)
Jackson/Pinedale
(June 1-September 30)

Park
Teton and Sublette

3\. Changes in high-cost localities. The list of high-cost localities in this notice differs
from the list of high-cost localities in section 5 of Notice 2018-77.

a. The following localities have been added to the list of high-cost localities: Mill
Valley/San Rafael/Novato, California; Crested Butte/Gunnison, Colorado;
Petoskey, Michigan; Big Sky/West Yellowstone/Gardiner, Montana; Carlsbad,
New Mexico; Nashville, Tennessee; Midland/Odessa, Texas.

b. The following localities have changed the portion of the year in which they are
high-cost localities: Napa, California; Santa Barbara, California; Denver,
Colorado; Vail, Colorado; Washington D.C., District of Columbia; Key West,
Florida; Jekyll Island/Brunswick, Georgia; New York City, New York; Portland,
Oregon; Philadelphia, Pennsylvania; Pecos, Texas; Vancouver, Washington;
Jackson/Pinedale, Wyoming.

c. The following localities have been removed from the list of high-cost localities:
Los Angeles, California; San Diego, California; Duluth, Minnesota; Moab, Utah;
Virginia Beach, Virginia.

SECTION 6. EFFECTIVE DATE

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This notice is effective for per diem allowances for lodging, meal and incidental
expenses, or for meal and incidental expenses only, that are paid to any employee on
or after October 1, 2019, for travel away from home on or after October 1, 2019. For
purposes of computing the amount allowable as a deduction for travel away from home,
this notice is effective for meal and incidental expenses or for incidental expenses only
paid or incurred on or after October 1, 2019. See sections 4.06 and 5.04 of Rev. Proc.
2011-47 (or successor) for transition rules for the last 3 months of calendar year 2019.
SECTION 7. EFFECT ON OTHER DOCUMENTS

Notice 2018-77 is superseded.

## DRAFTING INFORMATION

The principal author of this notice is Maxine Woo-Garcia of the Office of
Associate Chief Counsel (Income Tax & Accounting). For further information regarding
this notice contact Maxine Woo-Garcia at (202) 317-7005 (not a toll-free call).