Per Diem Rates from the U.S. General Services Administration
Search by city, state or ZIP code, or by clicking on the map. You can also use the new per diem tool to calculate trip allowances
Rates are set by fiscal year, effective October 1 each year. Find current rates in the continental United States ("CONUS Rates").
Uniform Capitalization Rules (UNICAP) - IRC Section 263A
The uniform capitalization rules specify the costs you add to basis in certain circumstances. Certain activities are subject to the UNICAP rules.
You must use the uniform capitalization rules if you do any of the following in your trade or business or activity carried on for profit (with certain exceptions discussed below):
- Produce real or tangible personal property for use in the business or activity.
- Produce real or tangible personal property for sale to customers.
- Acquire property for resale.
You produce property if you construct, build, install, manufacture, develop, improve, create, raise, or grow the property. Treat property produced for you under a contract as produced by you up to the amount you pay or costs you otherwise incur for the property.
Tangible personal property includes films, sound recordings, video tapes, books, or similar property. Under the uniform capitalization rules, you must capitalize all direct costs and an allocable part of most indirect costs you incur due to your production or resale activities.
To capitalize a cost means to include such costs in the basis of property you produce or in the cost of your inventory, rather than deduct them as a current (in the year the expense is incurred or paid for).
You recover these costs through deductions for depreciation (i.e. business equipment), amortization (i.e. section 197 intangibles, such as patents and copyrights), or cost of goods sold when you use, sell, or otherwise dispose of the property.
Any cost you can't use to figure your taxable income for any tax year is not subject to the uniform capitalization rules. For example, if you incur a business meal expense for which your deduction would be limited to 50% of the cost of the meal, the deductible 50% amount is subject to the uniform capitalization rules but the nondeductible 50% of the cost is not subject to the uniform capitalization rules
Exceptions to the Uniform Capitalization Rules
Beginning in 2018, you're not subject to the uniform capitalization rules if:
- Your average annual gross receipts are $25 million or less for the 3 preceding tax years, and
- You're not a tax shelter. See section 263A(i).
In addition, the following are not subject to the uniform capitalization rules:.
- Property you produce that you don't use in your trade, business, or activity conducted for profit.
- Qualified creative expenses you pay or incur as a freelance (self-employed) writer, photographer, or artist that are otherwise deductible on your tax return.
- Property you produce under a long-term contract, except for certain home construction contracts.
- Research and experimental expenses deductible under section 174 of the Internal Revenue Code.
Note: Before 2018, if your (or your predecessor's) average annual gross receipts for the 3 previous tax years did not exceed $10 million you were not subject to the uniform capitalization rules for costs of personal property acquired for resale.
Capitalizing the Cost of Inventory
Section 263A of the Internal Revenue Code deals with the capitalization and inclusion of certain costs in inventory.
For example:
- Manufacturers must include the cost of direct labor and materials and certain indirect costs related to overhead in the cost of finished goods.
- Merchants who purchase inventory for resale must include acquisition costs, such as shipping expenses, in the cost of goods sold.