SECTION 11. EFFECT ON OTHER

DOCUMENTS

Rev. Proc. 97–58, 1997–2 C.B. 587, is hereby superseded for mileage allowances paid to an employee on or after January 1, 1999, with respect to transportation expenses paid or incurred on or after January 1, 1999, and, for purposes of computing the amount allowable as a deduction, for transportation expenses paid or incurred on or after January 1, 1999.

DRAFTING INFORMATION

The principal author of this revenue procedure is Edwin B. Cleverdon of the Office of Assistant Chief Counsel (Income Tax and Accounting). For further information regarding this revenue proce

December 28, 1998 32 1998–52 I.R.B.

stantiated in accordance with § 1.62–2(e), that exceeds the amount of the employee’s expenses deemed substantiated for such travel pursuant to rules prescribed under § 274(d) and § 1.274(d)– 1(a) or § 1.274–5T(j), and that the employee is not required to return, is subject to withholding and payment of employment taxes. See §§ 31.3121(a)–3, 31.3231(e)–1(a)(5), 31.3306(b)–2, and 31.3401(a)–4. Because the employee is not required to return this excess portion, the reasonable period of time provisions of § 1.62–2(g) (relating to the return of excess amounts) do not apply to this portion.

.09 Under § 1.62–2(h)(2)(i)(B)(4), the Commissioner may, in his or her discretion, prescribe special rules regarding the timing of withholding and payment of employment taxes on per diem allowances.

.10 Section 1.274–5T(j) grants the Commissioner the authority to establish a method under which a taxpayer may elect to use a specified amount for meals paid or incurred while traveling away from home in lieu of substantiating the actual cost of meals.

.11 Section 5.04 of this revenue procedure contains revisions to the list of highcost localities and to the high-low rates for purposes of section 5.