2011 per diem

You can most certainly sit down with your logbook and record each city you spent the night in and then look up the deduction for that locality in the IRS tables. It's a pain but not that hard.
I find that for me, it's easier to use the standard deduction.

 

I was told by a CPA that if I do not spend the night out from the terminal but work away from the terminal during the day that I can deduct the per diem on a pro-rated basis even if I return home although I must spend the day away over the lunch period. I have done this now for several years without a problem.
Any comments on this?

 

Your CPA is wrong. In order to qualify for the transportation worker per diem you MUST be away from your tax home for a required "rest break" which means a 10 hour mandatory DOT break before returning home.

A lunch break doesn't meet the criteria. If that were the case every local driver and line haul driver would be claiming the per diem as well.

 

Companies will never overpay you on Per Diem. If they do then if the IRS catches them they are "kicked" out of the program.

Keep track of what Per Diem is being withheld. Then figure out how many days you were out. Take the flat rate x days out. Days of home time/rolling out are figured at 75% of the flat rate.

Take what you are allowed minus what the company took. The difference is what you can still claim on your taxes. SO in the end you are still getting your full per diem.

Company's pay less tax all around, but they are not taking your right to Per Diem away.

I kept spreadsheets of what Per Diem off each load was taken and then what the Flat rate was. At the end of the year I had a difference of what I still could Claim.

Mark

 

Ok thanks Snowman and U2exit,I,ll add my Chicago days up and see what I have.I had countless break downs in Chicago,so there,s quite a few nights in the city,10 hr breaks in the city also. I need a decent return,because I had elbow surgery and won,t be driving for 4to6 months,can,t do anything with my hand,it,s been 2 weeks since surgery,4 more weeks before I can be cleared to lift 3 lbs oh boy. Since 08 I broke my #1 rule for myself,that,s don,t drive junk, and now I,m paying the price.

 

Who ya drive for V8.
As far as breaking down in Chicago you'll be ok as long as you Don't wear any Packer gear.lol

 

@slim shady: thats funny right there.

 

I went online to the IRS site and read about this. I then went to a number of different sights and most of them agree with the IRS that all the rules say is that it must "be reasonable and consistent". I didn't see where it said that you had to take a 10 hour break to qualify. I even found on the IRS site a question from another driver on this point and they said you could pro-rate it however you wanted ie. in 1/4 hour days (6 hrs working = $59/4 = $14.75 deduction etc) as long as "it was reasonable and consistent". Of course, the consistent part is pretty cut and dried but the reasonable part has enough wiggle room in it to mean almost anything.

Do you have any clarification or a webpage that has an IRS ruling that says something different? Thanks

 

Certainly. Here is the webpage link to educate your CPA and the specific section which supports my statement;


http://www.irs.gov/pub/irs-pdf/p463.pdf

Example 2. ​

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You are a truck driver. You leave your terminal and return to it later the same day. You get an hour off at your turn- around point to eat. Because you are not off to get necessary sleep and the brief time off is not an adequate rest period, you are not traveling away from home.

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CPA's that specialize in truck driver tax returns all agree on the interpretation of the above example. In order to "qualify" for the per diem the driver must take a Rest Break which is defined by FMCSA regs as 10 hours off before driving again.

The section about pro-rating is basically telling a driver he must use the same formulae for all partial days throughout the year. Dividing the day into quarter increments is acceptable but so is declaring each partial day at .75. Furthermore if you are using the hi-lo method ($59.00 per day) you cannot then use the City Tables for per diem to give the higher allowable rates. You must choose 1 method and use it consistently throughout the year.

Here are 3 organizations that will steer you straight in regards to your tax return;

John Turner based out of Houston Tx "The Truckers Accountant"

http://www.thetruckersaccountant.com/aboutus.shtml

Esta Klatzkin "Know Taxes"

http://www.knowtaxes.com

ATBS
http://www.ATBSshow.com

 

I'm not sure you are correct here in asserting that the company is "screwing the driver". True the company does this to reduce its tax liability but that is only a problem if you think that all money is the governments in the first place and the government should be able to decide how much you should get to keep.
Also, I've worked under per diem and do not see how the company deducts .02 cents to administer the plan. If your pay is set out directly and is equal to others not in the plan then are you saying the company is underpaying everybody? I would agree with that statement for all drivers in general at every company.
It is true this is put on drivers to benefit the company and will reduce not only Social Security but unemployment compensation but does anyone really think the government knows how to spend your money better than you do or that Social Security will be there for us when we retire?
I would rather have my money to decide what I do with it. I took the per diem and opened a Roth and a set aside savings program for myself so I could invest for my retirement myself.

Your very first statement here indicates that you think drivers will end up paying some type of tax on the per diem money when it is clearly non-taxable wages. I don't get your point?
Furthermore, calling a company decreasing its tax-liability a "scam" is no different than saying everybody that takes deductions when doing their personnel taxes is somehow scamming the government which brings us back to whose money is it in the first place? I would never call it a scam to keep what I earn for myself as it is MY money not the governments.

I bought a house while using this per diem structure. I gave the bank my w-4 and explained how the pay was broken down and they had no problem with this in the least.