Expense FAQ for Law Firm Administrators

For the bigger picture, see our guide to expense management for law firms.

Mileage and Transportation Expenses

Special M&IE rates for the transportation industry are $80 for CONUS and $86 for OCONUS.

For accurate record-keeping, it's essential to keep track of business mileage and transportation expenses. Use a log or spreadsheet to record the date, mileage, and purpose of each trip.

You don't need to worry about the type of fuel your vehicle uses.

Meals, Entertainment, and Travel Expenses

• High-Cost Locality: $329 per day (includes lodging, meals, and incidental expenses)

For High-Cost Localities, the Meals and Incidental Expenses (M&IE) rate is $86 per day, and for Other Localities, it is $74 per day.

These rates are applicable from October 1, 2026, to September 30, 2027.

When calculating your expenses, keep accurate records of your receipts and expenses to ensure accurate financial record-keeping and tax compliance.

Depreciation and Expensing for Law Firms

Law firms can deduct the cost of qualifying property through depreciation or expensing. The Section 179 Phase-out Threshold begins at $4,090,000 of total qualified property placed in service.

For passenger vehicles, the depreciation limit is $20,300 in the first tax year with bonus depreciation. Without bonus depreciation, the limit is $12,300. If your vehicle qualifies for bonus depreciation, you can claim a larger deduction in the first year. If not, you'll depreciate the vehicle over time.

For other qualifying property, you can choose to depreciate it over time or expense it in the first year. The choice depends on your business needs and financial situation. You should consult with your tax professional to determine the best approach for your law firm.

Keep accurate records of your depreciation and expensing, including receipts, invoices, and calculations. This will help you stay organized and ensure accurate financial record-keeping and tax compliance.

Tax rules, limits and rates change. Confirm current figures with the IRS or your accountant before you file.