I'm away from the house for 3-4 weeks at a time the half days would be the ones of me arriving and leaving back out. The rest are full days 10 hour resets as I run recap.
for the second answer you have me are you saying I would need receipts?
Per Diem Scam? Please explain the payroll calculations to me.
Discussion in 'Questions From New Drivers' started by Fly'nCJRanch, Sep 30, 2013.
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Here's how to enter your DOT per diem in TurboTax:
- In TurboTax, search for this exact phrase: job expenses, employee (you can copy/paste it from here).
- Then, if using TurboTax Online, click the Jump to job expenses, employee link in the search results.
- On the Tell Us About the Occupation You Have Expenses For screen, enter your occupation (Truck Driver, Airline Pilot, etc.) and click Continue.
- If you land on the Job-Related Expenses Summary screen instead, click Edit and then click Continue.
- On the next screen, select the checkbox You are in the transportation industry and click Continue.
- On the next few screens, you'll be asked about home office expenses, mileage, and other topics. Answer those questions as appropriate.
- Eventually you'll come to the Any Other Expenses? screen. On this screen, enter your unreimbursed DOT per diem in the field Meal expenses covered by Department of Transportation rules.
If you are ever audited, you may need to prove what days you were away from home. I just keep my log books...
That isn't what brian991219 was getting at though -- to claim per diem on your taxes you'll need to itemize which means losing the ability to take the $6,200-$12,400 standard deduction. So yes, you will want to keep every expense receipt so you can claim those expenses on top of per diem. In some cases, you may be better off not claiming per diem and using the standard deduction instead. Turbo tax will figure that part out for you though...
One of the main advantages of company perdiem is the ability to claim perdiem and keep your standard deduction.Last edited: Dec 27, 2014
brian991219 and RogerThat72 Thank this. -
Thank you very much
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It seems some people don't understand that per diem actually hurts the individual getting it over time. For example, an employer has to shell out a greater $ amount on an employee's social security and medicare taxes(calculated from gross pay)... than actually comes out of an employee's check. Thus, the employer can significantly reduce this tax burden to themselves by offering per diem. The catch? After years of this, it will reduce your bottom line in receiving these benefits(you are paying for them as is your employer). -
shredfit1 Thanks this.
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Yes, the trade-off is that your Social Security and/or disability payments will be reduced when you're no longer working: A 30 year-old driver earning $52,000/year and not taking company per diem will be able to draw $1,208/month from Social Security at age 65 (assuming SS is still around and they don't change the rules -- again). A driver earning $52,000 year, but having $14,000 of that as company per diem, can retire at 65 and draw $992/month. Sounds like company per diem is short sighted, right?
The thing is, the US Government is a very poor allocator of resources; it tends to borrow from its investments rather than, well, invest them. In fact, the current Social Security system is essentially a ponzi scheme, the only real differences being that a) contribution into the ponzi scheme is mandatory and b) the social security administration is kind enough to project when its ponzi scheme will fail (currently estimated to happen in 2030).
A conscientious investor can take that extra few thousand dollars and compound them at a higher rate to wind up with a better retirement. If that same 30-year old driver taking company per diem invests just $1,000 of their $2,000+ tax savings into an IRA or 401k at 8%, they'll have $191,555 in their account when they're 65. They can then draw $1,250 per month indefinitely (the account will actually still grow slightly).
So the company per diem driver utilizing only 1/2 of his tax savings towards private retirement will retire at 65 drawing $2,242/month instead of $1,208/month. Now who's being short-sighted?
But wait, there's more!
The 30 year old driver is utilizing private retirement in addition to the government so he's spreading his risk. Americans seem to take for granted the United States' continued existence; they should not -- great civilizations last, on average, 200 years. So what are the odds that the United States of America will have fallen by the time that 30-year old driver dies at age 90?
Probability of great civilization falling = 1 - (199/200)^60
= 26%
There is a 26% chance of a great civilization falling in 60 years! Is that a risk you're willing to take? And that is on top of the risk that Social Security won't still around assuming the USA does survive.thaistick Thanks this. -
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Heck, I'm doing better in the money markets. But nowhere near 8%. http://ycharts.com/indicators/sp_500_monthly_return
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