The IRS has announced that special per diem rates used to substantiate business travel expenses will remain the same for the year beginning October 1, 2025, according to Notice 2025-54. These rates apply under the substantiation method outlined in Rev. Proc. 2019-48.

According to the Journal of Accountancy, the high-low substantiation method continues with rates of $319 per day for high-cost localities and $225 per day for all other localities within the continental US.

Of these amounts, $86 and $74, respectively, are allocated to meals and incidental expenses for purpose of Section 274(n). The notice also confirms that the list of high-cost localities remains unchanged from the prior year. 

For taxpayers in the transportation industry, the special meals and incidental expenses rates also remain the same, $80 for travel within the continental US and $86 for travel outside of it. The rate for incidental expenses only continues at $5 per day. 

The notice is effective per diem allowances paid on or after Oct. 1, 2025, for travel away from home beginning that day. For deductions, the rates apply to expenses paid or incurred on or after that date, with transition rules available for the final months of 2025.