Per diem is the daily allowance given to federal employees and government contractors to cover lodging, meals, and incidental expenses while traveling for work within the continental United States (CONUS). Rates are published annually by the General Services Administration (GSA) and are widely used as the benchmark for private-sector travel reimbursement policies as well. This guide covers how they work for FY 2026 (effective October 1, 2025).
Quick overview
- Two components: Per diem = Lodging Rate + Meals & Incidental Expenses (M&IE). Each is set separately.
- FY 2026 standard rates: $110/night lodging + $68/day M&IE for locations without a specific rate.
- 300+ non-standard areas (NSAs): High-cost cities and tourist destinations have higher published rates.
- First & last day = 75% M&IE: On travel days you receive only three-quarters of the daily M&IE allowance.
- Updated October 1 annually: FY 2026 rates took effect October 1, 2025; always confirm current rates at gsa.gov.
- IRS safe harbor: Reimbursements at or below GSA rates are not taxable income to employees.
The Two Components of Per Diem
1. Lodging Rate
The maximum amount reimbursable for a single night's hotel stay, excluding taxes. Hotel taxes are reimbursable separately as a miscellaneous expense. The lodging rate is highly location-specific — a night in rural Nebraska uses the $110 standard rate, while Washington D.C. or New York City may exceed $250+.
2. Meals & Incidental Expenses (M&IE)
A flat daily allowance that covers:
- Breakfast, lunch, and dinner
- Taxes and tips on meals
- Tips for services (baggage handlers, hotel staff)
- Transportation between places of lodging or business and places where meals are taken, if applicable
GSA publishes a per-meal breakdown within the M&IE rate (e.g., $13 breakfast, $15 lunch, $26 dinner, $5 incidentals for a $59 M&IE area). If a meal is provided by the conference or agency, that meal's portion is deducted from your daily allowance.
FY 2026 Standard vs. Non-Standard Rates
| Rate Type | Lodging | M&IE | Applies To |
|---|---|---|---|
| Standard (Default) | $110/night | $68/day | All CONUS locations not listed as NSAs |
| NSA — Low tier | $135–$175 | $74–$79 | Smaller high-cost cities, some seasonal areas |
| NSA — Mid tier | $176–$225 | $79–$85 | Major metros and resort destinations |
| NSA — High tier | $226–$350+ | $85–$92 | NYC, SF, DC, Boston, and similar high-cost areas |
There are approximately 300 designated Non-Standard Areas (NSAs) covering most major cities, resort destinations, and high-cost government travel locations. Rates for NSAs are published annually at gsa.gov/travel/plan-book/per-diem-rates.
The First and Last Day Rule (75%)
On the first and last calendar day of any trip, federal travelers receive only 75% of the M&IE rate. This applies regardless of what time you depart or arrive. Lodging is reimbursed at 100% for each night actually spent away from home.
Monday (travel day): 75% × $68 = $51.00
Tuesday: 100% × $68 = $68.00
Wednesday: 100% × $68 = $68.00
Thursday (return day): 75% × $68 = $51.00
Lodging: 3 nights × rate (Mon, Tue, Wed nights)
Total M&IE = $238.00
How GSA Sets Per Diem Rates
GSA sets rates through an annual research process (GSA, Per Diem Methodology):
- Hotel industry survey: GSA contracts with Runzheimer International to survey actual hotel rates in each NSA and major travel market
- Seasonal adjustment: Popular seasonal destinations (beach towns, ski resorts) have higher rates during peak seasons and lower rates off-season
- M&IE adjustment: Meals rates are updated based on Bureau of Labor Statistics CPI data for food away from home
- Publication: Final rates are published in August/September and take effect October 1
Actual Expense vs. Per Diem
When standard per diem is insufficient — such as during major events when hotel prices spike far above the published rate — agencies may approve actual expense reimbursement of up to 300% of the lodging per diem, with justification and receipts required. This requires pre-approval in most agencies and is not available for routine travel.
Per Diem for Private-Sector Employees
Many private employers use GSA rates as the basis for their own travel reimbursement policies. Key points:
- Reimbursements at or below GSA rates are treated as accountable plan reimbursements — not taxable income under IRS rules
- If your employer pays a flat per diem above GSA rates, the excess is taxable wages to you
- Employers can choose to use the IRS high-low method (simplified CONUS rates) or actual GSA rates — either qualifies for the accountable plan exclusion
Per Diem for Self-Employed Workers
Self-employed individuals and sole proprietors can deduct business travel using either actual costs or the IRS per diem method. Important rules:
- Meals are deductible at only 50% of the per diem M&IE rate (IRS, Publication 463)
- Lodging cannot be deducted using per diem — only actual lodging costs with receipts
- You must document the business purpose of each trip
- You cannot claim per diem for travel to your regular workplace
International Travel (OCONUS)
GSA rates apply only to CONUS (continental United States) travel. For travel outside the continental U.S.:
- Alaska, Hawaii, U.S. territories: Rates set by the Department of Defense (PDTATAC)
- Foreign countries: Rates set by the Department of State (State DSSR)
FAQ
Do I need receipts to claim per diem?
For M&IE per diem, receipts are generally not required — the flat rate covers meals and incidentals. Lodging reimbursement does require receipts showing the actual amount paid.
What if my hotel costs more than the per diem lodging rate?
You are responsible for the difference unless your agency approves an actual expense exception. Always book within the per diem rate when possible, or get pre-approval for higher-cost lodging.
Can I keep unspent per diem?
For federal employees, yes — per diem is a flat allowance, not reimbursement of actuals for M&IE. If you spend less on meals, you keep the difference. Lodging is reimbursed at actual cost up to the rate, so there is nothing to "keep."
How do I find the per diem rate for a specific city?
Use GSA's per diem rate search at gsa.gov/travel/plan-book/per-diem-rates, or use our per diem calculator — enter your destination city and travel dates and we calculate your total reimbursable amount automatically.
People Also Ask
What is per diem pay?
Per diem pay is a daily allowance given to cover travel expenses — lodging and meals — while away from your regular workplace on business. It is not wages; it is a reimbursement for travel costs.
Is per diem taxable?
Per diem paid at or below the IRS-approved rates (GSA rates for CONUS) under an accountable plan is not taxable income. Per diem paid above approved rates is taxable for the excess amount.
What is the per diem rate for 2026?
The FY 2026 standard CONUS rate is $110/night lodging + $68/day M&IE. High-cost non-standard areas have higher published rates — look up your specific destination at gsa.gov or use our calculator.
Sources
- GSA — Per Diem Rates (gsa.gov/travel/plan-book/per-diem-rates)
- GSA — Per Diem Rate Methodology (gsa.gov)
- IRS — Publication 463: Travel, Gift, and Car Expenses
- IRS — Revenue Procedure 2019-48 (per diem substantiation)
- Federal Travel Regulation (41 CFR Chapters 300–304)
Disclaimer: Per diem rates are updated every October 1. Always verify current rates at gsa.gov before submitting travel vouchers. This guide is for general informational purposes and does not constitute tax or legal advice.