Can I claim per diem on 1099 tax income??
Hello experts,
I recently decide to work as an independent consultant for the first time. I am from Chicago. I got a contract to consult for an end client in Ohio but will get paid from a Florida based company. This agent will pay me an all inclusive hourly rate on 1099 form.
What I did was to find a temporary apartment in OH close to client location. Durng weekends, I will either drive or fly back to Chicago where my husband and I live.
I know that I am going to pay HUGE amount of taxes. So I wonder whether I can claim a daily Per diem allowance as my tax deductions??
I used to talk to a friend she said it might raise some red flags to IRS and suggested that I should go by the receipts for expenses instead. But then I would not be able to deduct for things that I do not have receipts like rent.. Plus, I think daily per diem allowance would give me a bigger tax deduction amount anyway..
Can experts throw some lights on this question please? If I can claim per diem, then which state should I reference the rate from? Shoud it be Ohio where I work or Florida where the company I get paid is located?
Thanks much,
Monica