Abilene Motor Express....A New Place To Call Home

Income Tax Heads Up

Just a reminder of an issue that was discussed a while back.

Recap: Abilene does convert some of your CPM to Per Diem but it's probably not the full amount that the Driver can claim. Abilene converts a portion (7 CPM solo) from wages to tax exempt ... so, for example, if you are taking a 34 while OTR you are still eligible to claim the Per Diem but didn't drive any miles to reclaim that amount through Abilene... or if you only drive a few hours during a day then only a portion of Tax Benefit has been reclaimed.

While I am not a Tax Advisor and this is not Tax Advice, you may want to run some calculations to see if you might be leaving some OTR Tax Benefit on the Table.


Stay Safe,
MD

 

No question dude, that was a jackarse you mounted. ... city folk, sheesh

I know it was too short but, good to have ya back buddy.

 

Been here about 6 months now. Best I've been able to average per 2 week pay period is about 5400 miles. Doesn't seem to matter how they run me either. Cross country or regional.

Now I prefer a full year to average and things do seem to be picking up some so for me, the jury is still out on this.

The way I see it, in a company this size, 6 months is barely enough time to get to know one another. I think (hope) I'm earning some respect, communication is improving and I'm getting more of the longer runs I prefer to do.

Bottom line is, I'm more inclined now to call this home than I was 2 months ago.

 

That being the case if you itemize your taxes anyway, would I be able to write off anything I buy 65+ miles from home, cell phone, etc.?

 

I wish the W2 would show the Perdiem pay received. The amount showing as earned being less than I was actually paid isn't going to be helpful when I go mortgage shopping in the near future.

 

You failed to mention the 7 1/2 percent the company saves by not paying social security taxes on, per diem (in this case) is nothing more than a tax dodge.

 

It's there as a total per Diem paid listed on the W2 (top above the actual W2 I think) but that IS a downfall of handing the per Diem in this matter... it shifts the tax free money/benefit from driver to company... it's NOT income... they are paying a portion of your expenses.

It also decreases the amount of income received when calculating ones Social Security at the age of retirement.

Per Diem, either paid on top of wages earned, like most nontrucking companies, or converted wages after the fact, like how many trucking companies, either way it's not a wage issue.

Similar issue would be Cell Phone Expense... if your pay for your own cell phone then you can deduct it as an expense come Tax time... but if the company provides you a cell phone then the money is a company expense and not driver expense. The difference in per Diem is that trucking companies actually "reclassify" the amounts from wages to expense after the fact.

 

Not really a "tax dodge" but a more complicated method of paying a driver expense... using my example above, if they pay for a cell phone for the driver to use then it's a direct expense to the company.... or if they reimbursed you for using your own phone then that money never touchs wages either.

The company does benefit from handling it this way, and there is a decrease in wages to the driver, but it's actually in line with any other expense the company incurred in business.

It's only strange as most expenses never touch drivers wages... but the way the trucking industry handed it, the amounts go into wages first and then get reclassified after to expense.

My preference is that they not touch it and let the driver claim the full benefit, but ya, life.

 

It isn't listed on my W2. My total wages on the W2 is about $9k less than I have listed as YTD earnings on my last payroll statement of 2016.

If a bank or mortgage company only considers income as stated on the W2 then that could negatively impact the ability to get a loan.

 

I am not a tax advisor but I've never heard of the 65 mile limit... deductible expenses are most all expenses used in support of your career that are not reimbursed by the company.

Cell phone service, if not provided or reimbursed by the company would be deductible, or at least a portion of the total. As would be GPS, cell phone, clothing, cleaning supplies, microwave, some would even argue that XM radio is deductible as you get news and weather via its broadcast.

Again, consult a professional tax advisor or I'm sure the IRS has guidance to deductible expenses that would be a good source of information too.