Per Diem and taxes

Yes the per diem is in addition to the standard deduction. By the way it went up to $59/ day. At the end of the year IRS will allow you $59/ day to be deducted. The bad part is this also lowers your FICA (social security) that the company has to pay their half.

As far as what you actually spend it on doesnt really matter, although it is for food.

 

Taking the 59 a day will not effect your FICA....
It only does that if the company pays you perdiem as part of your pay.
So for your 250 days it is 14,750 x .8 = 11,800
Since you can claim 80% of it.

If your company pays you perdiem then you still have to figure it up. Because they will not pay you more than you are legally allowed. They get in trouble if they do that. So most will pay you part, but not all of what you are due.
So they may pay you .09 cpm in perdiem. That may end up being 8,000 at the end of the year. You subtract that 8,000 from what you could claim total. Then you claim the remaining amount.
There is a form for figuring out your perdiem that you do when you file your taxes.
It has exactly how to do it on the form. As well as a spot for money you already received if your company pays you some.

Also, on the 80% thing. This is how I always understood it. And how I file it. I have been told on here it is not correct. But I have also seen allot of info about it at times on here that I know 100% is not correct. So please make sure you get the proper form for fileing it, and read it over.

 

Not really getting this perdiem stuff-how is it that my company can deduct standard perdiem from my gross earnings (mileage pay,stop off pay) to offset tax paid-but they never ADDED anything to my pay that I didn't earn, and now I can't claim that on my federal taxes? any insight?

 

I have never heard of a company deducting from your pay for perdiem.
All that perdiem is when it is paid to you by your company is a reimbursement.
Meaning they are giving you the money back that you would have spent of food etc.

Some company's will lower your per mile rate, and then pay you a perdiem that replaces that, and is paid to you pre-tax. So you are not taxed on it.
But they do not take money from your check for perdiem. That is backwards.

 

alot of bottom-feeders do that. and it's crooked. per diem is meant to be in addition to your pay, not replace a portion.

 

I wish I never went to work for them! Maybe this will make my plight seem a little less confusing-W2 says wages $6135.63 box 12 says $5596.27 (L) claimed single and zero dep. and all they took out was 500.69 fed. Now to look at the last paystub of the year gross is 12093.16, that 5596.27 was
"perdiem" which means not even on the correct amount of days I was on the road did they "subtract" 52.00 a day and on top of that-when it went up to 59 a day they were still at 52.-is there anyone out there with exper.
with this mess? Is there anything I can still claim myself like perhaps the differance they messed up on? I can prove everyday-my wife went through every cell phone bill and log-the differance with this company is over 2200 bucks

 

Well, the IRS is going to check with you on it anyway. So I would go to them first.
The company is obviously not doing the perdiem calculation correctly. Which means that they are not in compliance with IRS rules.
The company does this to lower the amount of tax they have to pay on employee's.
You are not liable for the tax on the money in box 12. If it is correct.
The perdiem changed in like September last year to the 59 a day. So it was the lower amount before that.
I am guessing with that low of income you did not work for the company more than 5 or 6 months. So you just need to figure out how many nights you were away from your tax home for your 10 hour required break.
Then figure out what the total is on perdiem.
If they over paid you on that, then you will owe tax on the overage. And the company will owe tax on it as well.

 

Remember, per diem is based on nights away from home, not the days on the road. Whether you are an o/o or a company driver, buy a small monthly calendar book and list each of your loads with where your start on the day and place and continue until the day you return home.

The person doing your taxes should ask you how may days you were on the road, but that actual question should be, "how many nights were you on the road away from home." Also, your number give should match your log book.

By tracking this way you should be able to match it against your pay check since you know how much you are getting from the load. If the dollar amount is different you should know it at each pay period.

 

Actually you are incorrect about that. The IRS allows certain professions to claim a portion of their income as non-taxable, because when you file you would have deducted that amount anyway.

In the case of the trucking profession it is based on per mile for every mile you drive away from your home and do not return home the same day.

As a former IT professional I was allowed per diem per hour based on the city where my contract was as long as I was not with-in what was considered normal driving distance from my home.

Ex. If I worked in Durham, NC and Lived in Raleigh I could not claim per diem, however, if I worked in Charlotte and lived in Raleigh I could. It is not feasible to expect me to drive 2.5 hours to come home each night and to drive 2.5 hours to get to my jon each day. Yes I know as truckers you are driving a lot more, but in this case it's driving to where your truck is and you getting back to where your POV is to drive home the same day. So the IRS added that tiny clause about billeting overnight.

As OTR drivers, most are away from that "normal distance" for weeks on end.

Per Diem is designed to increase your net income, not your gross. and to put the money in your pocket when you need it and not every April 15th.

As was stated previously it does not preclude you from claiming expenses, but it must be subtracted from whatever you are claiming. The trick is to spend more then your per diem, or you will be taxed on what excess was not taxed.

The IRS always wins if you can't prove YOUR case. They don't have to prove you guilty, you have to prove your innocent.