Contract employees receive a 1099 that does not have separate boxes for pay and federal per diem. Business meals are generally allowed at 50% . The per diem is different and may be 100% allowed for contract employees out of town for under one yr.
I can not find a clear answer in the IRS publications (17,1542,463,535 and topics 511 and 512) for contractors. Have these regulations changed recently?

If per diem is included in your 1099-misc, then take deduction on schedule C or C-EZ (Form 1040).

Where on the schedule C do you take this?
Do you subtract it from the gross income at the top or as a misc. deduction below?

On the MEALS line.