Tax Law (Questions About Taxes)/Is per diem an income?


QUESTION: Dear Mr. Stancil,

I did an internship in the U.S. from August 2012 to February 2013, I am considered a nonresident alien.
In 2012 all my paychecks show "per diem" as the only earnings. I didn't receive any kind of form (W-2, Form 1042 or others) from my employer.
I'm currently trying to file my taxes and have no idea which forms I need to fill out or if the "per diem" is not taxable and not considered an income at all an thus I don't have to fill out anything?
I'm using Glacier Tax Prep and it's showing me several forms (W-2, 1042S, 1099...) that I could add, but as I said, I have received nothing from my employer. The other option is to say that I didn't receive any income and then I just have to file the form 8843.

For 2013, January and February in my case, my employer noticed me that I have to fill out the W-2 and my checks also show tax withholdings, due to a tax law change.

I know that I don't have much time to figure this out, but I was told earlier in the year that I don't need to file anything and now I was told I have to.

It would be great if you could help me with this.

Best regards,

ANSWER: Britta,

Thanks for your question.

If you were paid a per diem and did not account to your employer for how you spent that amount, it is taxable.  Normally a per diem is paid for travel expenses. To my knowledge, there was no tax law change that affected this, most likely your employer realized he was doing it improperly.

Hope this helps.

John Stancil, CPA

---------- FOLLOW-UP ----------

QUESTION: Dear Mr. Stancil,

Thank you for your fast response.

I can't quite believe that my employer did it improperly, since it is a global company with a lot of interns. Unfortunately they refuse to give any tax advise. I don't know if they just called it per diem and put it as a stipend in their own records. I was told that they claim it to be for rent/food, since as an international intern I have to relocate from my home country just because of the internship.

The message I got late 2012 regarding the taxes and per diem said: "Effective January 1, 2013 earnings will be reported as taxable for J-1 International Interns.
As a J-1 International Intern you have been receiving a non-taxable living allowance payment and a company paid rental car. As part of a standardization initiative, the company’s goal is to standardize pay practices across the organization and optimize compliance with all relevant tax laws.  The company has a legal obligation to withhold applicable Federal and state income tax  on compensation paid to U.S. employees. As a result, beginning January 1, 2013, all living allowance payments and payments made by the company on your behalf for a rental car will be reported as taxable compensation to you, with applicable federal and state income tax withheld."

Do you know of any circumstance where someone doesn't have to file the earnings they got because of a visa status or something like that?

Best regards,


Thanks for the additional information.  Your J-1 intern status allowed the company to pay you a non-taxable per diem. So you are ok for 2012.

It appears that the company has changed how they classify your pay, so they are correct in regard to 2013 going forward.  

John Stancil, CPA

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John Stancil, CPA


I can answer questions on personal income taxes, partnerships, and some corporate income taxes. I can deal with some state tax questions. Limited gift and estate tax questions. I am also familiar with ministerial and church tax reporting issues. I am Professor Emeritus at Florida Southern College. Sales taxes and property taxes are state and local issues so I am not likely be be able to give you an in depth answer on those types of taxes. I have maintained a CPA practice, specializing in tax, for over 35 years. I am a member of the National Association of Tax Professionals, The Florida Insititute of CPA's, The NCPE Fellowship. In addition I am a Certified Mentor for SCORE. Visit my website at I also offer seminars and consultations to churches and clergy on their tax issues at Also visit my blog, I am listed on Tax Connections at Prepare and file your own taxes at


I hold a doctorate in Accounting, and am a CPA. My certifications of CIA, CFM, and CMA are inactive. I passed all certification examinations on the first attempt, and received honorable mention for my scores on the CIA exam. I have operated a CPA firm for over 37 years and have taught accounting and tax at the college level for over 35 years.

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The CPA Journal, Florida CPA Today, Green Consumer, Green Business, Global Sustainability as a Business Imperative, Palmetto Review, NATP TaxPro Quarterly, Mustang Journal of Finance and Accounting.

DBA University of Memphis MBA University of Georgia BS in Accounting Mars Hill University

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