Tax deductions

Taxed on deductions? I am so confused.

 

I'm not making a lot of sense out of your post. First, if a company writes something off as an expense, somebody else picks that up as income (who ever they paid it to). If you are talking about an O/O or L/O , their statements may have a line item for fuel surcharge, which is added as income. If you are a company driver and the boss hands you $50 for fuel, you best be handing him back a receipt so he can take it off as an expense on his taxes. If you are a O/O or L/O you keep the receipt and write it off as an expense on your taxes.

 

Deductions are not income, therefore not taxed. It's as simple as that.

 

If the OP is an O/O or L/O operator then the company may deduct fuel from his settlement. That does not make it a deduction though. As an O/O or L/O the OP has to claim that money as income, but can deduct what is paid back to the company as an expense. The company may have other reasons also, for example if the pay the fuel company 2.34 per gallon and sell to you for 2.36 per gallon, thy have to account for .02 markup per gallon minus their costs for tanks, fueling equipment, electric etc. . The accounting is more mental work than holding the steering wheel and rowing the shifter.

 

Not all Deductions are tax deductible though. As an O/O or L/O he is taxed on the gross (total) and allowed to deduct SOME deductions to come up with a NET (taxable) of income. I think the OP may be a little confused between O/O and L/O also. A trucking company shoves three things at an O/O, 1.) A load, 2.) A pile of Money, 3.) a Pile Of Sh_T. It is then up to the O/O to deliver the load and divide the money between operating costs, taxes, profits and deal with the always there #3. There is not a lot of difference between an O/O and a L/O when working for a company except the L/O pays the company man wearing a different hat money so he can lease the truck.

For both O/O and L/O most everything shown on the 1099 is taxable, it is up to you to show the IRS what you can deduct and come up with a NET income and pay tax on it. You as an O/O or L/O have to deduct the fuel/repair/tire/etc. expenses. That's why you get a 1099 instead of a W3

 

If it's deducted, then it's not taxed. There's not one thing that is deducted, but taxed anyway. Business expenses (fuel, truck payment, maint) are all deducted from settlements, and therefore not counted as income.