Per Diem Pay

There were a couple of long threads about this. I don't know where they went. If you do a search for per diem on here they will come up. Turbo trucker has a post that explains it pretty well. Roehl also mailed out a pamphlet that explains it around the beginning of the year.

 

Here is the article. I hope this link works. Just go down the page, you will see it.

http://www.roehlhonorprogram.com/pdf/Interchange_JanFeb_07.pdf

 

That roehl site was pretty good,but,like I said before if you don't get the full 54 dollars a day thru them,you can still claim the difference to get the whole 54 and not just the 75% of the 54,which is 39.00. Like some others have said here,it depends on if your state has certain criteria to take advantage,this is why i highly recommend a tax professional or certified public accountant,they will figure it whichever works best in your situation and the state you live in. They must also know trucking also ,to take full advantage. Another thing I learned from the tax man on landline was,you are allowed to pay your child to work,wash,clean your truck,also you can give a relative like a son or daughter a tax free gift of 11,000 or 12,ooo once a year. Like I said alot to this,seek a real pro,it is well worth it.

 

You and your wife can each give each child $20,000. per year for a total of $40,000 per child is the way I've heard it. This rule also applies to your BLOOD relatives.....Mom, Dad, Sister, Brother.

 

Trying to get here early....with some real facts.

Per diem pay deals with "taxable income"

You'll be allotted so much per pay period, that is not taxed. Taking this, you lose your year end write off, since it was never taxed to begin with.

A few benefits include: A lower overall taxable income. Reduced child support requirements (due to lower reported income on W-2) I know custodial parents will enjoy knowing that one. More money at the end of the week.

A BIG negative (in my opinion) Reduced Social Security benefits, if you ever need them. You have a lower income, thus you have a lower benefit value.

Can you tell I am not a fan of Per diem?

Why? Per Diem Pay...used to mean, the amount the company GAVE me above my earned wages, to pay for meals while on the road/at work. Now it means a way for them to reduce their "taxes" along with yours. It was the same either way they did it (they got a tax reduction), they see a bigger benefit with the current structure. Simply look at what they do not have to pay this way

Beware of the Greeks......Nothing is for free.

 

Very important, IMHO. Thanks for the info!

 

My oppion

I have seen allot of people asking about Per Diem on these forms and here is MY opinion, since I have looked into to much myself. The three reasons to let your company take your Per Diem, with maybe a forth.

1) If you can't afford to put food on your table with your current income.

2) You have high debit, I.E. credit card bills. With that said, here is the kicker if you plain to take the lower pay per miles for the extra money you need to make sure that you put 100% of that money towards the bill and don't charge anymore. If you are not disciplined enough to do that then don’t do the company Per Diem.

3) You know enough about investing and are disciplined enough to stick a budget and don't have to worry about getting Social Security. If you know enough to figure your tax liability you can play with the numbers so you can take the extra money and invest it. If you don't know enough about tax's or investing DONT do it.

4) This reason I'm not sure how it would play out. If you get the earned income credit thing this maybe a good way to get extra money from Uncle Sugar on your taxes for being even more low income. BUT make sure you look into it first; since I don’t qualify I have not looked into it.

Remember only do this for a few years, unless you know investing, because it will affect your Social Security heavily when you are older. It also will lower your work mans comp, unemployment, disability, 401K, profit sharing and if you apply for a loan your income will low much lower because everything is figure before taxes and your income will look low. Only take the Per Diem plan for short term or you know how to handle your money.

This is only my opinion so if you disagree or can think of anything else please feel free to flame away.

 

In most cases of the folks that I know,its far better to take the per diem,if you don't you are paying taxes on 54 a day,thats ssi,federal and state and medicare,that's quite alot over 300 a week extra money being taxed,if you decide to claim it at the end of the year you only get less than half,if you don't claim it at all you are a fool. Take the per diem and invest the extra income again on an ira,401 etc. remember,if your company gives it,you get the whole 54 deduction,if you claim it yourself you get 75% of 54 which is 39.00.Big,big difference.

 

Look in the newbie section under 'per diem plan' Can anyone explain this to me?. Word to moderators... Merit it's own section...??? j/k.