Trucker Tax Tips & Deductions

I am an enrolled agent to practice before the IRS since 1984. I do not pay anyone. That is the penalty they assessed on the audit.

Ask your accountant about their accuracy penalty.


Here it is straight from the IRS been in the rules since 2008.

http://www.irs.gov/uac/Avoiding-Penalties-and-the-Tax-Gap

Accuracy Related Penalties
The two most common accuracy related penalties are the "substantial understatement" penalty and the "negligence or disregard of the rules or regulations" penalty. These penalties are calculated as a flat 20 percent of the net understatement of tax.

 

Roadmedic.
Doesn't it get tiresome having to repeat yourself all the time?
I read this entire thread in <2hrs.
And when does one cross the line from pompous to troll?
Thanks for being here.

 

Comes on giving advice and saying that what I posted is hardly believable yet provides no proof.

Just have to consider the source.

 

When hiring professional services, that's always something I look for. Someone who professes to use magic or has extra sensory perception.

 

Quick Q for Roadie and I apologize if it's already been asked and answered: I'm a company driver. My CPA takes the per diem deduction at a per mile rate for all the miles I've driven. She has me track all my paid miles (which I do using an Excel Workbook I created to track all the info about every load so I can keep an eye on the company and know as I go about what my pay is gonna be for this week which helps my wife plan for the week we actually get paid for it ) then she takes the per diem mileage rate (I don't remember what it is but it's like 50 something cents per mile) and backs out 9 cents per mile from that since my company pays me 9CPM per diem pay and then the software washes it to whatever percent it's supposed to be and uses that as my per diem deduction. Is she doing it right or am I gonna be in trouble if I get audited. I keep hearing about a daily rate and not a per mile rate. She's H&R Block so that's the software she uses and I've never had a problem in the past but then again the only audit I ever went through wasn't really an audit it was just my ex trying to claim the kids when they lived with me so I had to show IRS that I was the one entitled to claim them, not her but now I'm a little concerned. I have used this particular H&R Block for 10 years because the franchise owner is actually a genuine CPA so I figured she should know her stuff, but now I'm wondering. Thanks in advance.

 

While company paid per diem is often done on a per mile basis, per diem is actually a daily rate and has nothing to do with mileage. It sounds like what she is doing is backing out the employer paid portion and then having you deduct the remainder. However, the methodology sounds like a really bass-ackwards way of doing things. It's not necessarily wrong, but it's not how I would do it.

 

When you put it that way it jogs the questions she asks banging away on the 10 key so I think you're right. I think what she's doing is trying to come to a reconciliation of what I've been paid as paid by miles and what I am due on a daily basis and backing the money I've been paid already out before claiming the deduction. I see her challenge now. We don't want to deduct what I've already been paid, but the deduction and the pay are measured differently so how do we get to the same measuring stick do the deduction is accurate?

I'm sure I could set up my workbook to give me an arithmetic mean average of the number of miles I run per day, that's pretty simple. I already calculate it weekly, monthly and annually. Could do the same thing with what the company paid me in PD already and come up with an average I had already been paid and back that out and deduct any balance: but is the IRS cool with averaging like that?

I see the issue now: It's an accurate conversion of a paid PD by mile to a Deduction by the day thing. Got to get those two things to be an accurate measure of each other; averaging is simplest bust I wonder if the IRS would accept that. If not then I'll simply have to figure out a custom formula that will do it on a daily basis.

Thanks: Good info.

 

I don't think you will need to do any averaging. Your company should be able to tell you the total of what you were paid in per diem. You need to figure out what is total actual per diem you are allowed based on the number of days you were away from home. Then, the total allowed, minus what the company paid you, is the amount you are able to deduct on your return.

 

Seems like a complicated way to begin with.

As long as they do not exceed the "daily" rate less the miles paid out for the per diem, you would be okay. The trend to make it complicated could bite you in the rear, since you are ultimately responsible for the figures on the return.

 

Cool thanks. I'll just track the total number of days and that will give the total figure of allowance and the last paystub of the year will have the total per diem paid and she can just back that out and claim the balance. Thanks everyone.