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AlanC
Level 1

IRS M&EI versus Actual Expense entries

Hello,

I am an Independent Contractor (solely 1099) and bill my clients for travel expenses. I do track M&EI as distinct expenses in QB Self-Employed

 

How can I track the IRS Standard Allowance for M&EI, which may be higher than actual billed expenses, in QB Self-Employed? This results from the client and contract travel policy allowance being lower than IRS M&EI allowance and lower than actual expenses. I do track M&EI allowance in a separate Excel sheet, but would like to only use one location.

 

Example: Houston M&EI standard allowance is $61 for the second day of travel. Client allowance is $37. Actual expense is $61.00. The M&EI allowance breaks even, expense to client recovers -$23.00.

 

I am mainly interested in reconciling and getting the best and allowable deduction for M&EI when filing in 2019. I can always adjust the invoiced expenses to the client to the contractual allowed or actual expense.

 

Thank you for any advice.

Solved
Best answer March 03, 2019

Best Answers
Rustler
Level 15

IRS M&EI versus Actual Expense entries

The IRS per diem is a tax time election based on your trip log.  Check with a tax accountant cause some things have changed, but as I understand it, it is an either or situation.  You claim per diem for the year (all trips), or you do not.

 

You do not adjust the customer invoice or your books, your books are actual expenses and income.

 

when you use per diem, mileage allowance, simplified home office deduction -that is instead of actual expenses for that type of thing.  As a result the tax form will be different than the P&L.

View solution in original post

2 Comments
Rustler
Level 15

IRS M&EI versus Actual Expense entries

The IRS per diem is a tax time election based on your trip log.  Check with a tax accountant cause some things have changed, but as I understand it, it is an either or situation.  You claim per diem for the year (all trips), or you do not.

 

You do not adjust the customer invoice or your books, your books are actual expenses and income.

 

when you use per diem, mileage allowance, simplified home office deduction -that is instead of actual expenses for that type of thing.  As a result the tax form will be different than the P&L.

View solution in original post

AlanC
Level 1

IRS M&EI versus Actual Expense entries

Thank you, Rustler.

That explanation of the M&IE as being the tax time calculation from a trip log and not tracked in QB is what I was looking for.

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