How Per Diem works now

Obviously a situation where a company cuts your pay to give you per diem isn't a good situation, and it's obviously not the situation I'm talking about either.

You're one of those "these companies just want to screw you!" guys, and it's very hard to change your guys' minds on a conviction you already have.

 

What does it cost the company? This is what I want to find out.

And yeah, your specific company's per diem policy sucks.

 

Not one of us is paying 22% effective tax rate. If they are they need a better accountant. Redo the math with 15% effective tax (average overall fed, state, FICA tax rate for 2015). Also drop gross pay by 2-4% first. It doesn't look nearly as rosy.

Look at what the average American has in their retirement accounts and their personal savings. Then rethink the above.

 

What does it cost to give drivers cash advances? It depends on how many drivers take them, how big the company is, etc. Same for per diem. Most of the cost is administrative- they need to spend time filling out forms, doing math, etc. Plus there are some fees from the government .

 

What are the fees from the government?

 

A: None of them seperate it out that way to my knowledge. Further if they did withhold $63 a day it would be a tax violation. You are allowed 80% of $63 dollars. Or a little over $50.
B: most peoples effective tax rate is in the 12% range.

 

A. My company does

B. Ok dude

 

If they are holding 63 you owe for the difference. Yeah they are helping you out.

 

Ya ya ya I no. Maybe so, maybe not. $15= a pack of smokes, egg Mc Muffin and coffee in the morning. (And yes we all no a RESPONSIBLE driver. Doesn't smoke, and makes his coffee and eggo. In the truck with his walk mart kerug. Heats his eggo with his Wal-Mart micro everyday) Thats why responsible drivers can take a week off and go on a trip around the world every year.

 

Ending the confusion over per diem