Why do companies charge drivers for per diem?

Discussion in 'Experienced Truckers' Advice' started by A Bug, Jan 29, 2018.

  1. kemosabi49

    kemosabi49 Trucker Forum STAFF Staff Member

    Jan 13, 2013
    SW Arkansas
    Also, and yes I know most people don't expect to need it, If you end up umemployed or are hurt on the job you benefits will be lower too.
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  3. MsJamie

    MsJamie Road Train Member

    Why do companies do it? Because it lowers *their* taxes.

    If you itemize, and every OTR driver should, you can claim every bit of that per diem.

    Technically, it does lower your taxes... by lowering your annual income.
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  4. Brian76

    Brian76 Light Load Member

    Jun 26, 2015
    You can’t itemize anymore after 2017 tax year. So now what?
  5. MsJamie

    MsJamie Road Train Member

    And what gives you that idea? Don't believe everything you read on the Facebag. Itemizing your deductions is alive and well.

    The standard deduction nearly doubles in 2018, so a lot of people will be better off taking it over itemizing. However, the break even is with 118 days on the road for a single person; double that if married. Personally, I'll be able to deduct an additional $4000 or so by itemizing in 2018.
  6. Tb0n3

    Tb0n3 Road Train Member

    Oct 5, 2012
    Wait, your companies reduce your pay for per diem? My carrier pays me the same with or without per diem. It's just extra. Is that unusual?
  7. Accidental Trucker

    Accidental Trucker Road Train Member

    Jun 4, 2015
    Actually, the unreimbursed employee expenses are no longer allowed in 2018. Taxpayers can still itemize, but per diem is a unreimbursed employee expense, and can no longer be deducted by Company drivers.

    One of the reasons that companies deduct two cents is because they can only deduct 80% of the Perdiem expense on their tax returns.
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  8. farmboy73

    farmboy73 Medium Load Member

    Oct 23, 2015
    Knoxville, TN
    As a company driver, going forward you will no longer be able to itemize. Our company announced this morning that they will re-implement Per diem, which they had discontinued a few years ago. There will be no additional charge. They cited changes in tax law and the fact that we will no longer be able to itemize the Per diem as the reason.
  9. p608

    p608 Road Train Member

    Nov 10, 2016
    Funny I said the same thing 30 years ago and it's still around.
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  10. Toomanybikes

    Toomanybikes Road Train Member

    Apr 8, 2009
    Yup, the driver taking the per-diem on his own tax return is done for.

    Even if it wasn't officially, the increase in the standard deduction would likely make it unfeasible.

    Don't get the notion that someone in government did you a favor though, because the personal exemption is gone. Most truck drivers will likely be paying more in taxes.

    Company paid per-diem used to be, almost always, a huge driver rip-off. Drivers would be conned into the notion they were cheating the government out of some tax money, when they were almost always cheating themselves out of their own earnings. Don't believe me, search this forum, the numbers have been gone over time after time, and unless the company is handing you the full per-diem amount each and every day, then driver is loosing out.

    Not so anymore.
    p608 Thanks this.
  11. RumbleTruckin

    RumbleTruckin Light Load Member

    Jan 14, 2018
    I worked at a company that kept .02 if you were on per diem, they said it was to pay for the per diem program, which was done by a 3rd party.

    I told them to cancel it and I would "keep my 2 cents to myself".

    ...Pun intended. I also learned that office people don't like puns.
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