Per Diem Scam? Please explain the payroll calculations to me.

It definitely was the two W-2s I had while working for a company paying per diem. They're sitting in storage buried in some boxes right now after moving unfortunately.

While looking for information on whether it legally must show on your W-2 I found something interesting. For a trucking company to pay per diem as part of mileage pay they must have an accountable plan for per diem. Under accountable plan rules the employee must provide receipts for all expenses to substantiate the per diem provided by the company. I've yet to see a company that pays per diem as mileage require receipts for expenses.

Now generally with accountable plans the amount does not have to show on your W-2 which is why it probably doesn't show on yours. In reality, trucking companies aren't following the rules of an accountable plan so it should show on your W-2 as it's technically non-accountable at that point which is possibly why it shows up on mine. The problem with that is an accountable plan is required to pay per diem as mileage or percentage. Quite a legal conundrum. There is a car allowance that could be used to get around this but honestly I'm not sure about that one.

On another interesting note, if you're related to your employer you must provide receipts regardless.

I'm glad I don't have to deal with that crap anymore.

 

If you do your own taxes how do you do this so you actually get the money? I did what you said and for one week alone it's $135.58 after I multiplied the 59x7 - company per deim divided by 80%

I use turbo tax.

 

Nobody can reply on this? Maybe if I posted something dumb like...." Who hair tests" everyone and their mothers would reply then...

 

California, .35 CPM and they per diem scam you

here's the solution... tell him to change jobs where he's not being ripped off and taken advantage of.
Noobs coming out of CDL school are getting paid more than that.

As for WHY the company does it.. it saves THEM money.

 

Perhaps, taxes give us headaches (They do). Perhaps, we don't use Turbo Tax (I do mine by hand). But here's your answer:

If you are NOT having per diem taken out of your check you need to rely on your logs. If you have Elogs, you need to be sure to print them and keep them for your taxes.

You must count the number of days you are on the road, the number of days you went home or went back to work from home, the number of days you had off entirely at home or on vacation. They should total up to 365 days.

For the number of days on the road you get to use this year's full per diem amount for transportation workers - ****which is 80% of the standard per diem allowed by the tax code for everyone else****
For the days you went to or departed from home you take 75% of the 80% adjusted per diem figure. (A partial day to reflect partial day at home)

Vacation and full days of home time don't count.

Add those two dollar amounts and file it on the schedule C(?) of your 1040. (The one where you list all your write-offs) Keep your logs with your tax forms in case you get audited and need proof.

The per diem amount has a chance of changing every year, so drivers be sure to check your tax book for the amount you can write off.

Hope that helps.

 

Per diem should be accepted only if it is added to your cpm..if they pay 36 cpm , then say 16 cpm is paid in per diem ..take it only if its 36 + 16..not 36 -16..10/4 ??😧

 

It really doesn't matter if anyone here answers you or not ... at best there are some half truths and most of it is flat out wrong ... all of the answers in this thread only bely the fact that none of them actually know what per diem really is and they barely know the mechanics of how it works, but not why.

Want to learn about per diem ... go to the IRS web site read it there and consult with a tax professionals.

You want to learn about something truckers are experts at got to a truck stop and ask about special forces operations ... the diner is filled with ex Navy Seals, Green Berets, Rangers.

 

that's not an accurate statement, the truth has been posted especially in one post. the way most mileage companies pay what they call per diem, is actually a way to lower their matching ss and medicare, workmans comp premium( as its usually a percentage of payroll), unemployment tax etc. as in the case of a .35 cent a mile driver whose company pays him ten cents a mile of that in per diem, he gets taxed on 25 cents per mile, while the company will pay not ss , medicare, workers comp etc on that ten cents . say 3000 miles a week , the drivers would generate 1050 dollars in a week and 700 would be taxes . the other 350 would be treated as per diem and the company would not pay the 7.5 percent of ss and medi, with the work comp etc probably a savings to the company of 75 to 80 bucks depending workers comp rate, multiply tht bt 1000 trucks and ya got 80,000 a week or over 4 million a year.

the driver gets a bit more take home pay, but in the overall package could actually lose money when he files taxes depending on number of dependents, etc.

but the main thing is, the companies didn't dream this up to be nice to employees, its another method to addl profits.

and that about sums it up, get hurt, go on workmans comp or ss disability and it bites you in the rear, get killed and your ss surviors benefits will be less, as you will show less taxed ss income for your last quarters worked.

 

Ok so is this true or not. Example- last week I worked 7 days. 7x$59.00= $413.00 My company have me a travel allowance of 263.16 for that week. Subtract 263.16 from 413.00= 149.84. 80% of 149.84 = 119.87 continue for the year by doing days out and get my final number to still be able to claim for the year....?

 

True depends on two things:
1) You have to be away from home long enough to require a 10 hour break per the DOT hours of service (days leaving from home and returning are only 75% of 80% and days you do not stay away from home, meaning you leave and come home the same day are not eligible)

2) For you to get any benefit of the per diem you have to itemize your taxes, otherwise you will get the IRS standard deduction.