Per Diem.

In your situation, with substantial retirement already, you should definitely take per diem.

 

Whether per diem is a good deal Depends on a lot. Many companies offer per diem per mile but lower rate per mile. Now if you can choose between say.. .40 a mile or .30 a mile + .10 a mile per diem it is a no brainer. More take home. But some companies offer per diem but also charge a cent or 2 a mile for privilege (bookkeeping) rip-
off. You not only get paid less per mile but show less gross plus lose future soc security and man you better watch how many miles they are actually crediting you with.

 

Name a company (how big?) that currently does either of these things. From taking advantage of a driver (false bookkeeping claims) to outright fraud (under calculating miles).

 

I hope you are only curious because I would be offended if you were questioning my veracity. I choose not to name any companies in this context for fear of liability.

 

Forget naming a company for fraud, under statement of miles. Just name one that currently charges drivers book keeping fees for drivers usage benefit of company per diem. No liability issues here, since it would be an actual practice made known to the company drivers. Note: I can't find any, since the rules for company per diem records changed, or should I say the lack needed of.

 

Swift, for one.

Under the old system they took out 10 cpm for per diem and paid back 8.5 cpm as non-taxed income.
The new system is different, but the same thing happens.

 

Swift, Knight, Schneider, just to name a few.

 

Thank you, yes, I see from Swift drivers they take out $71 for every day your out over 75 miles from home for company per diem, but only pay you $66. So Swift keeps $5 for record keeping in this case. The good and the bad with this. The good is that you get far more in per diem, thus less taxes, than if per diem was calculated on a straight cpm basis. The bad, is that for this extra record keeping, number of days out over 75 miles, the company keeps $5 of you money.
Let's say you had a choice of per diem by Swift current rules or by some other companies by cpm @ say .10 cpm.
Average miles driving in a week, 3000. Under Swift per diem you would get $497-$35= $462 tax free,
CPM method (@.10) 3000 X .10 = $300, with no fee. Question would be, what do you save in taxes on that $197 difference that you are not required to pay on with Swift over CPM. Answer, depends on you federal tax backet, State of residence. If in the lowest tax bracket, 10% federal, no state taxes, 6.2% FICA. $19.70 + $12.21 = $31.91. But you lost $35. So in this case the CPM @ .10 would be better. But if your in a higher tax bracket and if you pay state taxes, then the Swift method would be better.

In conclusion, it's a wash. Take the Swift per diem.

 

Swift, Knight, Schneider all take 2 cents per mile. That’s why during orientation, they keep hustling you with per diem and how awesome it is.

 

Yes, if they charge you on the cpm method of per diem, it's a rip off (do not take the per diem, maximize 401k and IRA instead). New rules do not require the company to keep detailed driver expense records. Because of this, many companies have changed their per diem rules and do not charge anything for the cpm method (take these per diems, also maximize 401k and IRA).
Note: Swift changed theirs to daily rate (minus fee), which as I demonstrated above is about even with straight cpm method (no fee).