The leaves may be changing, but for the time being, the High-Low per diem rates are not.

The IRS has determined that High-Low Substantiation Method per diem rates for Fiscal Year (FY) 2013, which began on October 1, will remain the same as FY2012, according to Notice 2012-63.

Employers can pay a per diem rate to an employee on business travel instead of reimbursing them for the actual cost of the expenses they incur.  This is especially common in contract assignmentsbecause the worker is often engaged in a location far from their permanent residence and must maintain a second residence while on assignment.  

The High-Low Substantiation Method is a common method for determining per diem rates. In this method, the IRS sets a standard or "low" daily rate that applies to most localities and a "high" rate for large cities that generally have a higher cost of living. For FY2013, the high-cost-area per diem rate remains $242 ($65 for Meals & Incidentals, or ME&I, only). The per-diem for all other localities is $163 ($52 ME&I). 

The IRS announced last year it will only publish updates to the list of high-cost localities on an as-needed basis.  There were no changes to the list this year.

Debbie Fledderjohann is the President of Top Echelon Contracting, Inc.