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Posted:  1 year ago

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Federal taxes and Per Diem 2019

Keep in mind - trucking companies didn't come up with per-diem to do DRIVERS a favor. It was to do THEMSELVES a favor by saving millions in matching funds on fed tax withholdings.

Yes, definitely, before the Trump tax cut of 2017. Now it is the ONLY choice for company drivers as a "tax free" reimbursement.

Look at it this way - .13 per mile in per diem pay X 3,000 miles a week X 1,000 drivers X 52 weeks a year - the company "saves" (pockets) $1.5 MILLION in matching funds they would otherwise have to pay into taxes. Despite the "perceived benefit" of drivers having a few more $$ in their paychecks week-to-week, the companies were seeing a big time addition to their bottom lines, without lifting a finger.

Thanks to the Trump tax cut, we, company drivers, don't have a choice. How the company benefits is beside the point.

Back before the changes in tax code, you could deduct 80% of the $62 daily allowance for every full day away from home.

So if you were away 330 days per year - you could take a roughly $16.3K deduction. Which, (when balanced against the old $6K standard deduction) and all the other non-reimbursed deductions that were allowed, made for a sizable bite of your AGI/taxable income. Per-diem is for meals and other expenses when working away from home. Other expenses (gloves, etc.), all added up to a good reason to itemize previously.

This is all old news. New reality is here with 2017 Trump tax cut.

Keep in mind also - for most companies, per diem is NOT OPTIONAL, it is mandatory. With todays tax code - it will almost certainly lower your refund (if any), because it still counts as INCOME (even though taxes are not withheld on that amount).

This is completely false. Per diem reimbursement is not considered income. Please cite your source for this finding. The reason for lower refund is because new withholding percentages have changed and we're not adjusted from previous tax years before 2017 Trump tax cut.

For an outline of how the new tax law changes effect truck drivers, read this outline by a CPA. https://www.claconnect.com/resources/articles/2018/how-tax-reform-changes-and-doesnt-change-per-diems-for-truck-drivers

Posted:  1 year ago

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Federal taxes and Per Diem 2019

Yes, the tax code has changed dramatically, October 1st, 2018. Per-diem, as far as company reimbursement, is treated as non income, thus will not be included on ones gross income. Company drivers no longer can itemize per-diem separately on their tax returns. So if you want this "tax free money or "properly termed" expense reimbursement", you must take it through your employer.

https://www.claconnect.com/resources/articles/2018/how-tax-reform-changes-and-doesnt-change-per-diems-for-truck-drivers

Since this is considered an expense reimbursement, there will be no FICA or personal taxes on the per diem. No, this expense reimbursement, is not added back to your gross income since it never was income. As far as rules for the companies and how they treat or record these reimbursements. That is on them and there is much to be concerned in how a company needs to handle it. But as far as company drivers. The per-diem is a good thing to take if you have the voluntary choice to do so.

Oo's have no changes on handling of per diem.

Posted:  1 year, 1 month ago

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Jim Palmer Regional Company Driver - Thoughts?

Yeah ask them and update us. contracts change all the time too. the contract i signed is completely different from the Prime students today, It is possible you may get a different explanation as to why they want it, but its good to know.

I see your from MN. Try Magnum LTD, no contract required, great reputation/training for new drivers. Doesn't hurt to have other multiple offers.

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