What's wrong with per diem pay?

Discussion in 'Experienced Truckers' Advice' started by Gitana, Nov 27, 2013.

  1. full speed

    full speed Heavy Load Member

    Apr 20, 2010
    Los angeles CA.
    That makes sence, some of these trainers in these big companies can make some big money.
    To me they kinda ruin the industry that's one of the reasons why I never became one. But to each they're own.
    As well it might benefit a husband and wife team drivers write offs. As they usually split about a quarter a mile any way.

    But that 22 cents per on a mile on a solo guy common. Is it that good???

    And I don't buy it that these big companies are going to go broke if they haft to pay up. Come on now, turn them over. So the real industry can make some money.
    Last edited: Nov 28, 2013
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  3. rocknroll81

    rocknroll81 Road Train Member

    Sep 29, 2010
    West Allis Wi.
    On my last post I forgot to add that back in the late 80's a company that I drove for paid a mileage per diem and as other posters on this thread have stated about getting a loan, well some drivers with this company had that problem when buying a house, they had to get a letter from the boss stating that they where also getting a per diem and to add that to there income to up there finances to get a loan, again this was a smaller company, not sure on how that would work with a mega carrier.......
    full speed Thanks this.
  4. pattyj

    pattyj Road Train Member

    Jul 19, 2008
    Sioux City,ia
    Does most the companies have forced perdiem? is it a one size fits all plan?Do companies take out more then what you would spend if not on forced perdiem?
  5. HappyHardCore

    HappyHardCore Light Load Member

    Mar 19, 2007
    Very good point, never thought of that!

    Luckily I've always had to opt-in (not opt-out) and I never choose to opt-in into the program even though the company tries to advertise and beg us to do it. Why do the companies care about it so much? I'll have to do some more reading to find out.
  6. streetglider

    streetglider Medium Load Member

    Aug 21, 2011
    Found this in a overdrive mag from 2011. Maybe it will help

    Dollars & Sense

    Kevin Rutherford
    Taking the per diem deduction
    Kevin Rutherford |October 01, 2011

    What exactly is per diem? It’s Latin for “per day.” It usually refers to the daily rate of any payment. It also may refer to a specific amount of money that an organization allows an individual to spend per day to cover work-related living and travel expenses, such as meals.

    The per diem deduction primarily compensates you for the cost of meals on the road.
    In trucking, there are two separate per diem uses. You can get paid per diem from your employer, or you can deduct per diem on your tax return. As an owner-operator, you will never be paid per diem. But while the rules for deducting per diem are the same for both owner-operators and employee drivers, the method for deducting them on your tax return is different.

    Knowing the per diem basics will help you navigate the tax labyrinth. Don’t be afraid to get a tax second opinion before filing.

    To qualify for a per diem deduction, you must be traveling away from home long enough to be required to sleep away from home. If you take a short trip that doesn’t show any off-duty or sleeper-berth time on your logs, that trip does not qualify for per diem. Log books are always proof of per diem deductions.

    To claim the deduction, you need to know how many days you traveled away from home for the entire year. Go through your log books and tally up the days. Count days you leave for a trip and days you return from a trip as three-fourths days. So if you leave on Monday and return on Friday, you would qualify for 4 1/2 days of per diem that week. Then multiply the total by the current IRS per diem allowance, which is $59 per day. (Note that days spent in Canada qualify for $65 per diem.) If you traveled 245 days during 2011, your total per diem is $14,455 ($59 x 245). That amount will be adjusted on your federal tax return for the allowable percentage (80 percent), which brings it to $11,564.

    Owner-operators will report this deduction on Schedule C, which is devoted to business income and loss. The final amount reduces your income, dollar for dollar. If you’re in the 15 percent tax bracket, it reduces your income taxes by $1,735 ($11,564 x 0.15). It also reduces your self-employment taxes.

    Keep receipts or not?

    The idea behind per diem is to reduce accounting and paperwork for both the business owner and the Internal Revenue Service. You are able to claim the per diem deduction without keeping any receipts for the items that per diem includes, namely meals, beverages and tips.

    Since laundry costs are not presently considered a per diem expense, you can track your costs and receive a tax benefit.
    Over the years, the IRS has gone back and forth on whether the per diem includes laundry costs while traveling. As of now, laundry is not included in the per diem deduction, so keep all receipts for laundry expenses and deduct those separately.

    Many times you will be using coin-operated laundry machines and there won’t be a receipt. You are allowed to deduct travel expenses under $75 without a receipt if you keep track of them, so do that with laundry machines. Pick up an expense ledger from an office supply store, or just use a spiral notebook. Record the date, a description of the expenditure, and its cost.

    Kevin Rutherford is an accountant, small-fleet owner and the host of “Trucking Business & Beyond,” which airs on Sirius XM Radio’s Road Dog Trucking Radio. Contact Rutherford through his website, LetsTruck.com.
    Gitana, airforcetoo and full speed Thank this.
  7. aimhigh

    aimhigh Light Load Member

    Jan 21, 2011
    TX /USA - Germany -China
    Hello all
    This is indeed a touchy subject. It is hard to figure out which forum members are with the trucker and which are covert operatives moonlighting for some of these non opt out policy having trucking companies. My argument would be as follows: If Per Diem is indeed for the unequivocally financial advantage of the truck driver; then why is it necessary for those companies offering per diem, to additionally use forceful language imposing this as an condition of employment. Something is indeed wrong here! Furthermore, other trucking companies will sugar coat the employment condition factor by allowing you to opt out, but with additional administrative penalty(s)!

    As one forum member has already posted here, it is to your advantage to hire a Certified Public Accountant (CPA Specializing in Truck Industry Taxation), and although some can be quite pricey (especially H&R Block and Jackson Hewitt- and I do not recommend!), you can write off their fees!

    Recently, I posted a new thread, "My Job Search, what I've learned", and I touched on this topic myself as I turned down at least 7 out of 12 companies (in November 2013) I had contacted who were using forced per diem as a requirement for employment with no opt out options. Again something is definitely wrong with this.............. Lock & Load then Aim High!
    full speed and airforcetoo Thank this.
  8. NewNashGuy

    NewNashGuy Road Train Member

    Jul 27, 2011
    US and Canada
    Ever heard of cash? I pay cash for a car and put such a large down payment on a home that I am qualified for any house that I want. I love per diem since I itemize already and created a program that automatically categorized every penny I spend on my debit cards so near tax time all I have to do is hit the print button and I am done.
  9. full speed

    full speed Heavy Load Member

    Apr 20, 2010
    Los angeles CA.
    I'm just curious, what do you do as a driver. Are you a trainer for your company. And how often do you get home.
  10. Gitana

    Gitana Light Load Member

    May 23, 2012
    Kissimmee, FL
    Yeah, we're not worried about that part. We don't like to stretch credit to the limit either.
  11. NewNashGuy

    NewNashGuy Road Train Member

    Jul 27, 2011
    US and Canada
    why do you ask? I'm just a driver and I choose to stay at a month or two at a time but I can go home any time I want.
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