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274(d) or the fulfillment of criteria set forth by the
Commissioner as to expenditures less than a stated amount (de
minimis expenses). See sec. 274(d); see also sec. 1.274-5T(j),
Temporary Income Tax Regs., 50 Fed. Reg. 46032 (Nov. 6, 1985)
(authorizes the Commissioner to provide rules under which
taxpayers may deduct a set amount in lieu of substantiation for
meals while traveling away from home).
The Commissioner first set forth the criteria for de minimis
expenditures in Rev. Proc. 89-67, 1989-2 C.B. 795. There, the
Commissioner provided that “the amount of ordinary and necessary
business expenses of an employee for lodging, meal, and/or
incidental expenses incurred while traveling away from home will
be deemed substantiated * * * when * * * [the employer] provides
a per diem allowance” to the employee equal to the applicable
M&IE rate.4 Id. secs. 1, 3, 1989-2 C.B. at 795, 796. The
4 Government employees are generally entitled to a per diem
allowance for official travel away from their official stations,
as payment for lodging, meals, and related incidental expenses.
See 41 C.F.R. secs. 301-1.2, 301-7.1 (1994 & 1996). The per diem
allowance, which includes a maximum amount for lodging expenses
and a fixed amount for M&IE, varies depending on the area of
travel. See 41 C.F.R. sec. 301-7.3 (1994 & 1996). The
Administrator of General Services sets the per diem allowance for
travel to areas in the continental United States (CONUS rates).
The Department of Defense sets the per diem allowance for travel
to nonforeign areas outside the continental United States. The
Department of State sets the per diem allowance for travel to
foreign areas. See id. The list of the amounts of these per
diem allowances, including the breakdown of the portions
attributable to lodging and M&IE, is referenced in 41 C.F.R. sec.
(continued...)
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