Most companies reimburse employees for actual expenses incurred but some use an alternative per diem rate. The IRS annual updates the rates that they consider allowable payments to employees on a per diem basis.
The new rates apply to travel between October 1, 2014 through September 30, 2015 and are intended to reimburse the employee for lodging, meals and incidental costs paid or incurred for business-related travel away from home. There are specific rates for localities that balance the higher cost of travel. Cities such as Chicago, New York City, and Washington DC are high cost localities. Some areas are considered high cost “in season” only. A full list of the high-cost localities rates can be found in IRS Notice 2014-57.
Transportation between places of lodging or business and places where meals are taken, and the mailing cost of filing travel vouchers and paying employer-sponsored charge card billings, are not considered incidental expenses, so those charges can be separately deducted or be reimbursed for transportation and mailing expenses.
If your firm uses per diem reimbursement rates, please refer to IRS Notice 2014-57 for the new rates. http://www.irs.gov/pub/irs-drop/n-14-57.pdf