IRS issues Notice 2026-60 with per diem rates for travel year starting Oct. 1, 2026

# What the IRS released Notice 2026-60, its annual update of per diem amounts taxpayers can use to substantiate business travel expenses. The notice covers the travel year that begins Oct. 1, 2026, and runs through Sept. 30, 2027. It provides the special transportation industry meal-and-incidental-expense (M&IE) rates, the incidental-only rate, and the per diem figures and locality list used for the high-low substantiation method.

# The headline numbers

• Incidental-expenses-only deduction: $5 per day.

• Per diem for the meal-and-incidental-expenses-only substantiation method: $86 (high-cost localities) and $74 (other CONUS localities).

# What the "high-cost locality" list means The notice identifies high-cost localities as those with a federal per diem lodging rate of $280 or more. For travel to those localities, the higher $329 per diem applies under the high-low method. The notice includes the updated list of those localities.

# Who needs to pay attention

• Employers with accountable plans that reimburse employees for travel expenses. Using the IRS amounts simplifies substantiation and recordkeeping for reimbursed expenses.
• Self-employed taxpayers and business travelers who deduct travel expenses. Electing to use per diem rates reduces the need to keep every meal and incidental receipt.
• Transportation industry taxpayers who must apply the special M&IE rates specific to their sector.

# Practical steps for employers and travelers

• For transportation businesses, confirm the $80/$86 M&IE figures are implemented where applicable.
• If you use the high-low method, map destinations against the notice's high-cost locality list before assigning the $329 or $230 per diem.
• Continue to track the portion treated as meals ($86 high, $74 low) for Section 274(n) reporting and deduction limits.

# Why this matters now The updated per diem figures affect how much can be claimed or reimbursed without detailed receipts. The increases in the high-low per diem change the reimbursable ceiling for many higher-cost locations, and employers should adopt the new amounts before the Oct. 1 effective date to avoid incorrect reimbursements.

# Where to find the official details The IRS notice itself lists the high-cost localities and provides the full administrative guidance necessary for implementation. Employers and taxpayers should consult Notice 2026-60 for the official tables and any additional instructions.