Per Diem

I was also told it affects (Or is it effects? Can't remember) your vacation pay.

 

they base that off pd miles. so it would still apply.

 

So true on loans they say how much did u make oh 50k they look at your w2 no u made 29k. Then u have to explain it

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Personally, I don't see why anyone would want to donate extra money to the bottomless pit known as our federal government. It reduces your federal income taxes substantially, which is the primary benefit. Yeah, you pay less into SS and Medicare, but that is minor compared to federal income tax savings.

Again, like the other guy said, if you are single, no mortgage, no dependents, per diem isn't that bad. If you are itemizing deductions via mortgage interest and other issues, you'd be better off per diem.

 

You'd be right - if SNI wasn't charging two cents a mile to take 'advantage' of this program. For most drivers that amounts to over $2,000 annually. You can deduct per diem come tax time any way, so very few drivers would end up with more money in their pockets when all is said and done.

The other way to look at it is "Who would I rather have this money - the Feds or Schneider?"

 

That's true, but if you are deducting per diem yourself on your taxes and taking the extra 2 cents, you are itemizing your deductions and therefore, you can't take the standard deduction as well. So basically, with the standard deduction ($5800), you also get the per diem taken out pre-tax and then you take the $5800 deduction on top of that.

If you are taking the extra 2 cents, and you itemize the per diem, you can't take the extra $5800 deduction.

So, if you have a lot of other deductions to itemize, in particular, mortgage interest, then you're better off without per diem. If you're like me, single, no kids, no mortgage, then per diem is

A) easier
B) results in me paying very little federal income tax since my gross earnings are cut in half. Hell, my federal taxes will probably be less than $1000.

 

Well yeah, the biggest benefit they have is that it drastically reduces their Work Comp insurance costs. Work Comp premium is based on payroll, so by cutting your gross earnings in half through a per diem program, they are effectively cutting their work comp premium in half as well. Work Comp is PROBABLY their second most expensive insurance next to liability, but Work Comp is still VERY expensive for a company their size. They may actually be self insured I think, but I'm not certain. They would still have to go through the state department of insurance for any coverage or claim issues though.

What this also means if you go on work comp for an injury, you get 2/3 of your average weekly pay. In this case, you would get 2/3 of your GROSS. So basically, if you are on work comp, you are getting shorted big time. That's the major draw back for the employee on per diem, not paying less into social security. You just have to pick you poison and what you think works best for you personally. The social security issue is secondary IMO, considering that it may not even be there in 30+ years when we need it.

 

Anyway to go around per diem... what I mean.

If you're single, no house, no kids... but you want the extra .02, and your work comp/SS, show full pay on w-2.

Is there a way, to "work" the taxes at the end of the year and still get the $59/day deduction. Did I say that right?

 

yes there is. if a new hire, wait til the 90 days is up , or the start of the next quarter. Then request to be taken OFF. you cant have it both ways. Unless you claim the untaxed earnings as nonreported income. but consult a tax professional.