Going from Per Diem to regular pay

Discussion in 'Experienced Truckers' Advice' started by Sequoia, Jun 16, 2013.

  1. Sequoia

    Sequoia Road Train Member

    2,692
    1,792
    Dec 4, 2010
    Tampa Bay, FL
    0
    Hey guys and gals, I've got a finances question here.
    I've been looking at my settlements recently and figuring out how much more or less I would be making if I wasn't getting per diem taken out. So I pulled up one settlement and took the total miles for one particular trip and calculated the regular non per diem amount. Then I subtracted my current base rate (on per diem) and then subtracted the per diem rate. In one trip I would have made $62 more. On another trip I would have made $20 more. (now mind you I was looking at individual trips on one particular pay check so on this one in particular I would have made at least $82 more, plus the other 2 trips that were on that particular check that)

    But my question to you is, if I stop per diem, how much more in taxes will be taken out? Will I still be coming out ahead or will the taxes off-set the extra I would have made?
     
  2. Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.

  3. Roadmedic

    Roadmedic Road Train Member

    18,951
    8,973
    Apr 4, 2007
    0
    How are you paid?

    Weekly?

    You can check it out on the IRS, I can link after I know and then you have to figure the social security and medicare.

    If weekly, then page 44 of this link.
    http://www.irs.gov/pub/irs-pdf/p15.pdf

    Social Security is 6.2%
    Medicare is 1.45%
     
  4. jbourque

    jbourque Heavy Load Member

    924
    552
    Oct 25, 2012
    south english iowa
    0
    ssi retirement will be lower workmans comp will be lower your yearly tax base will change your company will make a few extra bucks off you
     
  5. OFTOTR

    OFTOTR Medium Load Member

    653
    676
    Jul 19, 2011
    Toccoa GA
    0
    What percentage or amount per mile are they claiming is per diem, now?

    Per Diem, the way most sleazebag companies pay it, is a suckers bet. Per Diem in the real world is paid in addition to a normal pay rate, not as part of it.

    Your paychecks will be a little smaller, but I bet you come out ahead overall by dumping the per diem, (As long as it's the fake per diem these companies offer)
     
    bigdogpile Thanks this.
  6. Reverend Falstaff

    Reverend Falstaff Light Load Member

    203
    175
    Sep 15, 2009
    0
    If you adjust the number of exemptions claimed by re-filing a W-4 form and if you contribute to a regular 401k (if offered) or a reg. IRA, you shouldn't notice much of a difference. Changing the number of exemptions will change how much tax is taken out & contributing to a retirement plan will lower your taxable income...now. There are a LOT more to consider than this, and you should talk to a tax pro that understands trucking; but short answer is both things I mentioned will do roughly the same thing as per diem pay.
     
  7. STexan

    STexan Road Train Member

    14,962
    29,122
    Oct 3, 2011
    Longview, TX
    0
    Is the OP thinking long-term or short term? If a trucker can see the bigger picture come tax filing time and can learn to properly do the standard meal deduction and itemize, i doubt there is any trucker that will NOT come out ahead financially by going away from per-diem. But if the driver is thinking in terms of living week to week and can not see so far down the road as to imagine a larger refund check next year, then I guess per-diem makes sense to them.
     
  8. Roadmedic

    Roadmedic Road Train Member

    18,951
    8,973
    Apr 4, 2007
    0
    You have to consider what their other deductions are.

    I did not have a mortgage so I had little in the amount to help. Per diem is then subjected to the 2% floor and you lose a hunk of the deduction. So, you have to consider all areas.
     
  9. cc tanker

    cc tanker Medium Load Member

    361
    211
    Jan 21, 2011
    Ohio
    0
    like OFTOTR said per diem should be paid on top of what your getting paid...the company I work for pays $29.00 per day above and beyond my salary earned..
     
  10. DGStrong71

    DGStrong71 Road Train Member

    1,279
    407
    Feb 22, 2013
    70° west
    0
    A tax refund is just money that was overpaid. Why give the government an interest free loan. I would rather underpay and then just pay in the difference at the end of the year. Here's a pic of what my pay checks like like on PD vs NOT. $60 more that week PR.jpg
     
  11. STexan

    STexan Road Train Member

    14,962
    29,122
    Oct 3, 2011
    Longview, TX
    0
    Seems like some are missing the entire point. I understand fully that a refund is not ideal but the point I'm trying to make is the standard meal allowance deduction allowance for truckers more than off-sets per-diem packages offered by most carriers.
     
  • Truckers Report Jobs

    Trucking Jobs in 30 seconds

    Every month 400 people find a job with the help of TruckersReport.

  • Draft saved Draft deleted