Ask Experts Questions for FREE Help !
Ask
    kieferluvr's Avatar
    kieferluvr Posts: 4, Reputation: 1
    New Member
    		  
    #1

    Jan 30, 2007, 09:31 PM
    Per Diem and more headaches
    Okay... here we go.
    PROBLEM #1
    My husband works out of state and is paid per diem, I think anywhere around $60-$80 a day and is not required to keep receipts or anything like that.
    On his W-2 for this company, they list one amount in the normal box 1 for the wages and such but in box 14 they list the per diem.
    We do know that they taxed his per diem, so even though they separated the amounts, does he add the two together and use that as his 'actual' wages, tips, etc. amount to put on his federal return?

    PROBLEM #2
    We live in Illinois but he works in Iowa and I found out that the two states have this reciprocal agreement to where he doesn't have to pay Iowa taxes since he's a resident of Illinois.
    My ? Is... the employer he works for is NOT an Iowa employer but based out of Minnesota but they took Iowa state taxes out... so, does the reciprocal agreement still hold true for him?
    Plus, if it does... does he get the amount back from Iowa that was taken out of his check and then does Illinois eventually get ahold of him saying that he owes 'whatever' to Illinois in place of the Iowa?

    This is really baffling me. I've done our taxes every year but these little 'read between the lines parts are really kind of weird.

    Thank you to anyone that can help me out or at least point me in the right direction!
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Jan 30, 2007, 09:48 PM
    PROBLEM #1:

    Report the figure listed in Box #1 as his wages.

    The figure in Box #14 is provided to allow him to claim that amount as an employee business expense on Form 2106.

    PROBLEM #2:

    The reciprocal agreement may apply. However, he will need to file an Iowa tax return to get his withheld money back if that is the case. If not, any tax he pays to Iowa should be credited back to him when he files his Illinois tax return.

    If you need professional help doing ANY of this, email me at [email protected].
    kieferluvr's Avatar
    kieferluvr Posts: 4, Reputation: 1
    New Member
    		  
    #3

    Jan 31, 2007, 02:08 AM
    Thank you for this information... I have another ? For you.
    I have already looked at this form but is he required to itemize everything which it looks as though this is what the form is asking for or can he ONLY list the amount he received as the per diem and NOT list anything else?
    I hope this makes sense!
    Thank you once again!
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #4

    Jan 31, 2007, 11:30 AM
    If you claim per diem, you do NOT have to list all his itemized expenses.

    That's the entire idea behind per diem: it allows you to claim a standard living expense for each day you are traveling and NOT have to keep track of your expenses.
    kieferluvr's Avatar
    kieferluvr Posts: 4, Reputation: 1
    New Member
    		  
    #5

    Jan 31, 2007, 12:56 PM
    Thank you once again... you truly are a savior!
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #6

    Jan 31, 2007, 03:40 PM
    Glad to help!

    Download Form 1542 from Internal Revenue Service to make sure you are claiming the correct per diem amount.
Not your question? Ask your question View similar questions
 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Is per diem taxable? [ 18 Answers ]

Can someone please tell me if per diem is taxable? My brother took a job this past year and half his salary is per diem, as he travels daily. He receives a monthly expense allotment for which he submits receipts. His per diem is for meals and accommodations only. Of course, he has asked me to...

Per Diem [ 1 Answers ]

As an employer, we pay per diem. I know I do not report it on their 1099's, but where would I claim it on our company tax return?

Per Diem for Contractor [ 1 Answers ]

I am employed by a VA based staffing company and at present I am working as a contractor at CA. I hold H1B visa and my legal status in the U.S. is non resident alien. Due to nature of my job, I am required to relocate at least twice a year. My question is that if I am working on an assignment which...

Per Diem and W-2's [ 1 Answers ]

I had been advised in the past to include per diem to my drivers on their W-2's. Can anyone tell me which line item the per diem amount goes on the W-2? Do I have to list this amount as Per Diem paid on the W-2 also? I am assuming so but just not sure where exactly to put the amount paid to the...

H1B and per diem and no w2 [ 1 Answers ]

H1B holder basic salary is paid in home country by home country employer who is in joint venture with H1B sponsor. Visa holder receives per diem amount in the US. He has not received any W2 or the like for 2005? What is his income for filing? Can he exclude the per diem payment? He is not from a...

View more questions Search