Per Diem

Per Diem (latin legal term) means:
Latin for “by the day”; referring to daily allowance, usually for travel, entertainment, employee compensation, or miscellaneous out-of-pocket expenses incurred while conducting a business transaction. The sum of money is always calculated on a daily basis and may be paid in advance or after the expense is incurred. Employees are sometimes paid on a per diem basis. If an employer pays for expenses using a per diem allowance, an employee can use the allowance as proof of the amount of expenses incurred. The U.S. Internal Revenue Service publishes yearly per diem rates that businesses may use to reimburse employees for travel expenses, and that employees and self- employed individuals may cite to substantiate the expenses.