Per Diem Rates Explained for the Self-Employed

Per diem is a flat daily allowance for travel costs, set by the government, that you can use instead of saving every meal receipt. It can simplify a lot of recordkeeping, but the rules for the self-employed have a catch most people miss. Here is how it actually works.

What per diem covers

The federal per diem has two parts: a lodging rate and a meals and incidental expenses rate, usually written as M&IE. For most of the country, the fiscal year 2026 standard rate is 110 dollars a night for lodging and 68 dollars a day for M&IE. High-cost cities have their own, higher rates, which you can look up by location.

The catch for the self-employed

Here is the part that trips people up. If you are self-employed, you can only use the per diem method for meals and incidentals. You cannot use the lodging per diem. For your hotel you have to deduct the actual cost and keep the receipt. So the M&IE rate saves you from tracking every meal, but lodging still works the old-fashioned way.

The first and last day rule

On travel days, you do not get the full M&IE rate. The IRS lets you claim 75 percent of the daily meals rate on the first and last day of a trip, since you are not away for the whole day. It is a small adjustment, but it is the rule.

Meals are still only half deductible

Using a per diem does not change the 50 percent meal limit. Whether you claim the M&IE per diem or actual meal costs, only half of the meal portion is deductible. The per diem just decides how you measure the expense, not how much of it you get to write off. For the full picture on meals and lodging, see meals and travel deductions.

Drivers get a special rate

Workers in the transportation industry, like long-haul truckers, get a higher special M&IE rate, which is 80 dollars a day for travel inside the continental US (and more for travel outside it) as of October 1, 2025. If that is you, see tax deductions for truck drivers. One general note: per diem rates reset every October 1, so make sure you are using the rate for the right period.

How Vuuv helps

Vuuv does not auto-fill federal per diem tables for you, but it is built for the approach that actually matters when you travel: capturing real expenses. You can log lodging, transportation, and meal costs as they happen and tag them to the trip, so whether your accountant ends up using actual costs or the M&IE per diem, you have a clean record to work from. Keep the lodging receipts, and confirm the right per diem rates with a tax pro.

This article is general information, not tax advice. Tax rules change and every situation is different. Confirm the details against current IRS guidance or talk to a qualified tax professional before you file.