How Per Diem works now

1) Any article that leads by quoting Kevin Rutherford is suspect in my mind.

2) This was written shortly after the law passed, other articles have expounded, but all say "this is pretty messed up, talk to a cpa as there are too many moving parts"

3) I keep saying and you keep ignoring the pay cut companies implement when running a company per diem plan.

If you could magically get all the data aggregated for cpm pay rates you would notice some trends. Companies paying hub miles tend to have higher rate per mile than similar companies paying practical miles. Companies that pay a per diem plan tend to have lower rates than companies that don't. Its hard to make even an apples to oranges comparison between pay structures with accessory pay, benifits, work structure, pto, etc, but general trends are there. Before this tax change it was universally accepted that most company per diem plans were bad for the driver. There were exceptions on a case by case basis, but overall they were not looked favorably upon. The tax change makes the math different, and for a lot of guys going to a company per diem plan makes sense. For many of us it does not. My CPA does not want me on the compaby option.

 

Me personally, i hate the idea of per diem, I'd much rather have a higher gross income because it works in my favor if i decide to get a home loan or financing where i have to prove my income.

 

[QUOTE="gentleroger, post: 7726009, member: 43957"]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.[/QUOTE]

Concerning the highlighted portion, I'm pretty darn close to that. I'm ok with paying an astronomically high amount in taxes. It makes me feal warm and fuzzy inside knowing I'm helping supporting the same knuckle dragging welfare rats that cut me off all day long.

 

Rutherford is a joke.

His math is as flawed as yours. But hey do what you want.

 

I'm not ignoring your point #3, I've already said that if your company is reducing your base pay to give you per diem in return, then that's pretty crappy.

That isn't the right way to do it or the way every company does it.

When the company I'm driving for right now introduced their per diem plan, they also coincidentally raised CPM. Would they have raised it more had they not done the per diem thing? Who knows.

If your company decides to offer per diem to you and DOESNT take away from your base pay to do it, I can't understand why anyone would prefer to not take it and not give less of their money to the government.

The best argument against it is social security but you can put your money in much better places.

 

I don't know much about him but you can find that same information in dozens of other articles across the internet written by people you might like better.

 

Or any other gross pay based calculations.

And I am serious if they are holding 63 out your going to pay through the nose on it.

 

Only 2 things are certain in life:

1. Death
2. This topic will continue to be argued
until death.

 

I'll look more into that, thanks.