For employers using the per diem rate table to reimburse employees for away from home business travel, the General Services Administration (GSA) has announced the updated rates. The tax table is for the fiscal year 2012 and rates are effective starting October 1, 2011 through September 30, 2012.

Employers can use the rate for business travel within the continental United States in place of tracking and reimbursing employees' actual expenses for lodging, meals and incidental expenses (M&IE) incurred when away from home for business. The per diem rates change depending on the location of travel. When employees provide adequate evidence of time, place and business purpose, the reimbursement will not be reported on their Form W-2 and is not subject to income or payroll tax withholding. However, the per diem rate may not exceed the federal governments paid rate to its traveling workers.

Ranges for the per diem rates vary from $123 to $367. With this release of the revised rates, the Alabama counties of Montgomery and Autauga have been added as localities on the tax table for fiscal year 2012. When the travel location is not listed, the maximum standard per diem rate will remain $123 ($77 for lodging and $46 for M&IE).

All per diem rates for locations can be searched by city and state (or ZIP code) and are conveniently located on the GSA website at http://www.gsa.gov/portal/category/21287.

Circular 230 Notice: If this communication contains tax advice, this advice was not intended to be used, and cannot be relied upon by anyone, for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.