How does per diem work for truck drivers

Industry Pay See All. How much do cEment truck drivers make? Grain Hauler Salary. Owner-Operators See All. Container Port Group Driver Pay.

Load Boards See All. Uber Freight Guide For Carriers. FR8Star Trucking Marketplace. How To Become a Freight Broker. How Much Is Freight Insurance? Driver Training See All. A nap does not necessarily consist of having to spend a full day away from home. Your off-duty rest period must be long enough for you to rest. In most cases, if you are fulfilling Hours of Service HOS requirements away from home, you can claim the per diem tax deduction. Rules for partial days If you are leaving or returning home, this only counts as a partial day.

So, what if you are a company driver and your employer pays you a per diem rate? The IRS states you are unable to claim a tax deduction on untaxed income. This is referred to as non-taxable per diem. However, you may still be able to claim a partial per diem tax deduction. However, if the trucking company pays you the federal per diem rate or higher, you cannot take a deduction.

Tax preparers and most tax preparation software perform these calculations for you. However, some individuals prefer to do their own calculations. Use the following formulas to determine your tax deduction amount. If you have a qualifying rider, the steps are mostly the same. Do the calculations for step one and step two. The IRS has a specific definition of what a tax home is. The following are three requirements for your tax home; your home must meet two of these requirements.

It is worth noting that many trucking companies considerably benefit from paying per diem. This is simply because these companies are paying lower wages to their drivers. And if the wages are lower, they have to pay a smaller amount of payroll taxes to the US government. Some trucking companies require truck drivers to take per diem. On the other hand, some encourage it. This is why as a truck driver, you should do your homework and then decide what is more suitable for you.

Whether you are a self-employed trucker or work for a company, documentation is important. You should save receipts and other documentation for all of your per diem expenses, such as meals.

This is because company accountants often require all reimbursement receipts. These receipts should prove the time, date, location, and items that you purchase for each expense. And similarly, if you are a self-employed trucker, you need to have documentation. This will be helpful if the IRS requires more supporting evidence of your per diem expenses.

You may also need this documentation if the IRS audits you. Note that using credit cards for your expenses is another great way to document all your purchases.

As you can see, there are some benefits and drawbacks of taking per diem pay. If you can easily afford your various road expenses without getting an advance on the wages and you can also wait until the end of every year in order to take per diem pay off your taxes, then you would be better off not taking per diem. In the end, it often boils down to what you prefer as a professional truck driver. Before you take your per diem upfront, it is important to consider if you require money to manage your expenses on the road or have sufficient savings, and you can easily manage your expenses until you can start receiving regular paychecks in order to keep going.

This article states that truck drivers cannot claim deductions for meals at tax time if they are an employee. Then it goes on to say that your company can pay you per diem as an employee in each paycheck if they have that type of program.

This is incredibly confusing. He spent two years writing software specifications then spent three years as a technical writer for Microsoft before turning to copywriting for software and e-commerce companies. By Chris Newton.

Operating Expense Many accountants classify per diem expenses for truckers as operating expenses. Self-Employed Self-employed truckers are able to write off per diem expenses when they file taxes. Per Diem Rates The U. Documentation It is important for both self-employed truckers and those employed by a company to save receipts or other documentation for all per diem expenses.

References U.