So I am going through an audit, have been for awhile now. Today, I spoke with a local IRS agent to set up a face to face meeting. IN the course of the discussion, according to her, showers while away from home are not deductible, as I would have taken a shower anyhow. She said if you were home you would take one, I said there is a difference between shower at home costing me $.02 per shower, vs. $10.00 on the road. Cellphones are also not deductible, as I can use a payphone or the customers phone, and if I break down, I should sit on the side of the road for as long as it takes for someone to check on me.
Also, according to her, every trucking company provides a meal per diem and always has.
Oh, and good luck finding a tax professional that understands the ins and outs of trucking and taxes, they seem to be few and far between.
According to the IRS>>>>>>>>>>>>>
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And as for finding a "few and far between tax professional" I think i'll stick with my guy. He tells me he likes audits.
How did the audit go, in the end.?
I'm sure that the IRS know we get free showers with a fillup but its not exactly earth shattering. And the other stuff?
I'm sure she has a long way to go to "get it" Sophisticated knowledge of the tax code is NOT her strong point.
And with Obamacare, I'm kind of surprised that they have time to do audits in the first place. They have got their hands full just with that !!But I guess the Govt is desperate for the money.
I hope it worked out for you. You know what you're doing, I'm sure.
Thanks for the comic relief.
Still not done yet, the phone call was to schedule a hearing with her, which then she says "well, depending on what your employer tells me regarding some things I called her about, you may not have to come in".
Since I rarely buy fuel on the road, I end up paying for showers.
I would suggest to immediatly reain the services of a certified tax attorney as the IRS agent you are working with has no knowledge of the proper deductions for transportation workers, and could cost you way more money than the attorney fees.
The shower issue could be problem, as I have "heard" that part of our regular per diem tax deduction is supposed to also include shower fees, this is only heresay so get a expert to advise you.
I got audited for 2008 and I had showers, cell phone, and per diem claimed. I did have to get two letters from the companies I worked for to state that they do not cover meals and other items they do not cover. I claimed about 15k each year for Per Diem. This was from Utah and the Main part of the IRS.
Per Diem is for Food. M&IE
Hours of service limits. If you are subject to the Department of Transportation's hours of service limits (as explained earlier under Individuals subject to hours of service limits in chapter 2), use 80% instead of 50% for meals while away from your tax home.
By the way, when you have a shower, or laundry, write a receipt out for it with the location, date and cost.
The cell phone thing is what got me, I was told in my last audit that I was to provide records to show it was for work only, the reason why I have three of them now (one is free so why now), One is used for personal use and the other is used for company business only and the third is the backup.
I believe the showers would be covered by the per diem write off. As an O/O the phone is a business expense. You can also write off your satellite radio along with your Dishnetwork/DirectTV bill(as long as it is in the truck) because of the traffic and weather channels. I would look into ATBS to do your trucking taxes. They specialize in the transportation industry. That's all they do.
I'm a little confused as this is in the oo section, but it seems as though you are an employee.
Either way, the shower is probably out. Some one mentioned that per diem is for food, but in reality, it's for food, lodging and incidentals. Laundry is not and incidental though and is specifically mentioned in the tax code.
If you are an ee, the cell phone is out as well. If you're an oo, the portion used for personal use must be excluded. Even if you could show that you made an attempt at excluding a portion for personal you'd probably be fine.
While I can't agree with her that all trucking companies calculate per diem, a very high percentage (probably north of 90%) do. You would know if you look at you actual check stub, not your settlement sheet. It should either specifically note per diem or have a column for non-taxable income.
You don't need a tax lawyer. You need either a good CPA, preferably one with a MST or an enrolled agent.
I don't get the impression you have a huge problem on you hands, unless you're giving us the watered down version. Even if you took 200 showers and an entire years cell phone, it's like a 3k swing in your AGI. Depending on your circumstance it's like a $300 tax bill plus a 5%/month late fee not to exceed 25%. File a 1040x pay the fee and move on.
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