Trucker Tax Tips & Deductions

http://www.traderstatus.com/travelexpenses.htm


Meals and entertainment
Younger traders probably do not remember the good-old-days when business meals were 100% deductible and business deals were hashed out over "three martini lunches." Meals haven't been 100 percent deductible for a long time and, like other entertainment expenses, the IRS combs them carefully for abuses. Expenditures for meals, entertainment, amusement, and recreation are not deductible unless they are directly related to, or associated with, the active conduct of your business. The IRS also requires you to keep a written or electronic log, made near the time that you make the expenditure, recording the time, place, amount and business purpose of each expense.
Even if you pass those two tests, only 50 percent of meal and entertainment expenses are deductible. If you write-off business meals through your company and there is a proper reimbursement arrangement in place, you won't be charged with any imputed income for the half that is not deductible, but your company will be limited to a 50 percent write-off.
For meal and entertainment deductions, on each credit card receipt, make sure the following are clearly written:

• Who was present (their names and their business relationship)?
• What business was discussed (immediately before, during or immediately after the meal/entertainment)?
• How was this related to your business? What was the purpose?
• Where was the business discussion held and the meal consumed (name and location of restaurant)?
• When was the meal/entertainment and business discussed (exactly on what date)?
• Exact cost of the meal/entertainment?

Meals Deductible Percentage Under 274(n)(3)
55% for years beginning in 1998, 1999
60% for years beginning in 2000, 2001
65% for years beginning in 2002, 2003
70% for years beginning in 2004, 2005
75% for years beginning in 2006, 2007
80% for years beginning in 2008, 2009
Section 274(n)(3) provides a special rule that increases the percentage that can be deducted for meals of persons, such as truck drivers, who are subject to the hours of service limitations established by the Department of Transportation.


Meals and Entertainment are addressed in the publication 463 chapter 2 that you listed as well.

 

Quick question....I'm normally gone for one night at a time then return home 2-3 times a week, and I'm not sure if I should claim the $59 or the pro rated rates for leaving and returning home.

Example-

Depart Syracuse, NY Monday and drive 5hrs to Boston where I take my full 10 hr break. Complete all my deliveries and return Syracuse, NY Tuesday night after nearly a full 14 hr day. Since I do leave home and return home the next day I feel like I fall into the 75% rate on both Monday and Tuesday.

 

If you are governed by a log book, and you have to spend the night on the road, then yes.

 

If you are using that deduction, you need to know the square footage of the whole residence, the square footage of the room you are using, and the percentage that the square footage of the room is in relation to the whole house, and only claim that percentage of the utilities and rent/mortgage.

Tell me how the dogs as security works when you do get audited.

People really need to learn how to find and talk to a CPA (certified public accountant) regarding taxes even if you are going to do your taxes yourself. The only time I ever paid someone to do my taxes was when I had employees, otherwise I do them all myself.

 

You have to pro-rate since you are only out a partial day each day.

 

is there a pc program or app that a 1099 driver can use to keep track of receipts and calculate how much money to withhold from paychecks for taxes

 

Being a cheapskate, I try to find free stuff - here's an accounting package that fits that bill.

www.gnucash.org

 

I like this thread, I learn a lot about trucker tax and deductions.

 

I'm a noob. What is the business use of xm/sirius for a truck driver that makes is deductible?

 

Same as an office building and the Muzak system.

Not to mention the weather part.