Per Diem paid by company vs. not?

the part that really pisses me off is when the co offers you ---say---36cpm
ok not a great wage but a wage
but then in the fine print you find out that 10 cents of it is per diem---whoooooaaaa a minute----so in actuallity they are only paying you 26 cpm YOU ARE GOING TO GET THE PER DIEM REGARDLESS---they arnt giving you anything---its yours already

 

sprokman & vmwelker understand the benefit to the driver of a company that pays part of your wage as per diem. Canuck, you are misunderstanding per diem pay. The are paying you the full .36. They are also giving you the opportunity avoid paying taxes on .10 of your income. I would welcome the chance to do this if it was offered. All of the concerns about reducing SS income (if it still exists when you retire), or unemployment are valid. I have seen the numbers on this. If you were to take the money you save in SS taxes and invested this you would be far ahead at retirement. This does require discipline. We offer per diem, but it is not required. If you like giving money to Uncle Sam, knock yourself out.

 

Oh yes...........I want to screw myself out of future Social Security payments.
I don't need to "save" on SS payments now, in order to save for my "retirement" at the same time. In fact, I find it irresponsible.

 

I walked out of my last interview with a company that had compulsory per diem

 

Pur48Ted--I definitely think that one should save for retirement in addition to SS. You get less from SS in the future because you are paying less in now. My point is that if you took only what you are saving in taxes by taking per diem pay, and invested only this amount it would offset the lower future payment that you would receive from SS. If you prefer to give to the government, more power to you.

 

good ponts cpape--but some companys offer you ---.36cpm--then in the fine print it says that 10 cents is perdiem--so in fact the company is only paying you 26 cpm directly and 10 in directley as it is per diem that you could claim at the end of year
i have no problems if they want to pay a decent wage and then offer the choice of taking your per diem on top of it or not---but its kinda crooked to pay so low and use per diem to top it off with
but i do understand the benifits of taking it throughout the year as well

 

and wow marten requires 16 cents of 39 to b per deim, what a rip

 

I'm new to this and doing my research as I start school next week. As I understand it drivers get a second check with their per diem amount. If you are applying for a mortgage or car loan or whatever you can present your per diem as additional income. It is not the same as a small business owner who hides their income in tax deductions, because if the driver did the same thing by claiming their $58 a day per diem they would still be reducing their net pay on their tax form. As long as you have pay stubs and/or an end of the year statement of your per diem earnings then you can you use that as proof of income.

As far as unemployment goes, I'm currently collecting in GA and the max you can collect is $330 a week and it does not take much to qualify for the max amount, like $17 or $18 thousand year. I'm sure even a 1st year driver would earn at least that amount minus the per diem pay.

As for SS and medicare you would still qualify for medicare when your time came because they don't offer care based on your income level. Your SS would be lower but as it has been pointed out if you took that per diem pay(even a fraction of it) and invested it you would be better off finacially than relying on SS. Just remember if you are young you can afford to invest with risk, but when you hit 55(if you plan to retire at 65) make sure you transfer your investments into low risk investments, so you don't end up like so many baby boomers a in '08 & '09 who lost their retirements in risky investments.

 

I'm confused....

If the 7 cents per mile that I'm paid per diem on figures out to be less than the $59.00 a day standard per diem, can I claim the difference?

Example: 7 cents per diem (for the last 5 days) is $150.... and if $59.00 day rate is $295( for the last 5 days)... Can I claim the $145 when I file taxes???

295-150=145

If I can, will someone please list a source to back it up (IRS publcation)?

 

Kazak, no you don't get a second check like normal people.
Duke, that's where drivers are getting screwed. Even though they tell you that .07 is perdiem, it's not. All they are doing is you save the taxes held out on that .07. Then they act like you didn't earn that .07. If you didn't claim per diem, that .07 was earned.

Workers comp, insurance, unemployment is all based on what a driver earns. Companies are hiding numbers with this so called per diem. So you see it's beneficial to them too. That's why some say it's mandatory. You won't see per diem listed on your W-2 either. The IRS doesn't have a clue. All they see is what's in the wages box.

Companies are deciding on their own what is perdiem and what isn't either. About 40% of my income is used for so called per diem. That means I'm only making .23/mile even though I make .38/mi. So am I getting $90 a day free? Nope, I earned it. I just don't have to pay taxes on $90/day which boils down to about $8 a day. Can you eat on $8 a day? That's actually what you are getting.

Any government or union job you get a seperate check of $59/day on top of your regular paycheck. Gov't jobs even get $85 towards a motel. That is real perdiem. It's not wages and it's not taxable. I worked for a gov't contractor once outside of trucking. I got my regular check and a seperate check for like $600 tax free for per diem every week.

As long as my W-2 shows no perdiem, I'm claiming the full amount. Even when you use trucker friendly tax software, it asks you nothing of per diem paid to you. That's because what these trucking companies are doing isn't right. Can you imagine if we were paid perdiem right or even for these hours we work for free. Shipping costs would go through the roof. So hey, feed the truckers a line of bull and we'll keep costs down.

With the reduced wages reflected on your W-2, you are paying less SSI. You go for a loan, it looks like you make alot less than you really do. A 401K, your contributions are reduced. You file a workers comp claim or disability, the amount you receive will be less.