The per diem in California gives employees an allowance to for job-related expenses incurred while traveling. The Internal Revenue Service established a minimum per diem rate nationally that employees can use to claim a deduction on federal income taxes. Many states and local areas have established higher per diem rates because of higher costs of living in specific areas of the country. The per diem rate you receive may also depend on a specific agreement that you have with your employer. Generally, a per diem in California is either paid to an employee by the employer or given as a credit on the employee’s tax returns.
California per diem expenses normally cover meals, lodging and other expenses incurred when you travel away from home to conduct business. To qualify, you generally have to work for another company, and the travel you receive the per diem for must involve work on behalf of your employer. Your employer may directly reimburse you for your travel expenses, or you can claim a deduction on your federal and state taxes for some of your per diem travel expresses. Specific travel expenses can include tips, tolls, parking fees, cell phone expenses and laundry. California’s Division of Labor Standards Enforcement has established basic rules and regulation regarding per diems in California.
When you are traveling on behalf of your company all of your expenses are not considered part of the per diem expense. For example, personal expenses such as entertainment or items you purchase not related to company business will not qualify as per diem expenses and you will not receive reimbursement for these expenses. In other words, if you purchase certain items when travelling for your business or if you exceed a set per diem amount, the cost of the additional items will come out of your pocket.
Depending on the company, it can take several months to receive reimbursement for your per diem expenses. To receive reimbursement, you will typically have to provide your employer with an itemized report detailing your travel expenses. If you do not receive reimbursement of approved per diem expenses from your employer, you can file a dispute with the labor commissioner of the state of California.
California Per Diem Rates
As of 2011, the average total per diem total rate paid in California is $177. Compared with the rest of the country, California has one of the highest per diem rates. This rate includes for both lodging and meals. Different cities in California have even higher per diem rates for lodging and meals. Although your employer does not have to use the average per diem rate for your area, make sure you receive competitive per diem reimbursement from your employer.
- IRS: How to Use Per Diem Rate Tables
- U.S. General Services Administration: Per Diem Rates Overview
- U.S. General Services Administration. "Frequently Asked Questions, Per Diem." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "Federal Travel Regulation, Section 300-3.1," Pages 22 and 71. Accessed Nov. 25, 2019.
- U.S. General Services Administration. "M&IE Breakdown." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Georgia." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Illinois." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "Factors Influencing Lodging Rates." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for New York." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Highlights." Accessed Nov. 25, 2019.
- Internal Revenue Service. "Notice 2019-55," Page 3. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Per Diem Payments Frequently Asked Questions," Page 2. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Topic No. 511 Business Travel Expenses." Accessed Nov. 25, 2019.
Brian Bass has written about accountancy-related topics and accounting trends for "Account Today." He works as a senior auditor specializing in manufacturing and financial services companies for one of the Big 5 accounting firms. Bass hold a master's degree in accounting from the University of Utah.