I am a contractor for company A. I travel to provide services for their client companies.
Company A reimburses me for meals at flat rate $42 a day for domestic and international traveling. Company A included all the reimbursement amounts in my 1099 form as part of payments to me.
Questions:
1. Is it correct to report per diem paid to me on Form 1099 which makes these payments taxable? Per Diem should not be taxable by definition.
2. If it is correct, can I write off this per diem amount at the same rate $42 or I can write off legal maximum for each location.
3. I do not have all the receipts to cover $42 a day. Do I have to write off what I can prove I spent or I still can write off legal maximum?

1) Actually, per diem payments is part of a non-accountable reimbursement plan which is, BY LAW, taxable.

2) Legal maximum per area.

3) Legal maximum. That's the entire idea behind the concept of per diem, to establish an amount that can be claimed WITHOUT receipts.