Werner Per Diem fraud

Lets play pretend.

You take thier per diem. You get 600 miles a day.
at .01 per mile that is $6 a day you LOSE.

Avg. amount of taxes paid is 35% total correct?

Lets say you make idk $0.26 /mile.
Total per day is $156 gross
Taxes on that is $54.6
So you made $101.40 for the day net.

So they pay you one cent less but don't tax .14 per mile of the .25(because you lost that .01 per mile).
so time for more math.
milesXamount /mile untaxed
600x.14= $84
milesXamount /mile that is taxable
600x.11=$66
Avg. amount of taxes times the amount of taxable income.
35% of $66=$23.10
Amount of taxable income minus the taxes.
So $66-23.10=$42.90
Amount after taxes Plus the amount that was not taxed.
$42.90+84=$126.90

So you made $126.90 per day by taking it instead of $101.40
Congrats You!!! Thats an EXTRA $25.50 per day.

O wait because you took their per deim you can't claim the real one at $59 a day.
So you really lost $33.50 per day. At the end of the year. WoW don't you feel like a tool.

 

Actually, you're wrong. It's a tax deduction, not a credit. You don't get paid $59 a day by the irs, you just get your taxable income reduced by $59 a day.

By the way, was it $52 last year or did i screw up my tax return?

 

Close.

The deduction is then limited by 2% of the AGI and is not a direct dollar for dollar reduction of the income.

 

If their Per Diem does not equate to the full amount allowed by the IRS, you deduct from the amount allowed what your company took and the difference you are still allowed to claim.

In other words, the companies Per Diem will never equate the full amount allowed by the IRS, because if the company goes over they get fined and could be dropped out of the program allowed by the IRS.

So, any driver on company Per Diem should be keeping track of what is taked out of their pay and compare it to the full amount allowed by the IRS.

If I remember correctly, the full amount is capped at 300 days allowed at the rate published by the IRS. That can be found at their web site.

Now, you can take the flat rate they allow or you can break it down by state on a daily basis. This means you would have to have been on line 1 or 2 for at least 15 minutes in that state to claim the states daily limit.

Mark

 

That's a LOT to keep track of though....

And the company can also take out too much like CRST tends to do.

 

why cant they just make it easy? Gawd. I hate those ########.

 

Used to be alot easier to do taxes before Reagan and the Tax Reform Act of 1986.

But then again, tax preparers should not look a gift horse in a bad light.

 

Maybe I was one of those 4 out of 5 that the IRS admits was given a wrong answer to my question when I called. I was told without receipts long as I was away from home I could claim $59 a day as a deduction. And thus if I paid less then that I would be owed the difference. Just what I was told so thats what I based my figures on. Also based them apon getting 600 miles a day with Werner. LOL phroziac I think you know as well as anyone how steady the miles are as a solo driver here. As my trainer said " Feast or Famine". One week 1000 miles next week 3500miles.

 

You are correct. You get the calculated 59.00. However the total deduction is subject to the 2% floor of the AGI. This in effect reduces the amount of the deduction by that figure.

 

Pardon my ignorance as I don't do my own taxes. but what is AGI? actual gross income? If so how does this 2% floor work? I am just trying to get all the math right so that we can show people how it is bad. Because we all know most people won't do the math.