The tax software, especially the online versions, have come a LONG way. I worked a tax season in a Jackson Hewitt office. Never did a trucking return though, kindof wishing I had now. Either way, most accounting firms, and individual accountants now use software similar to what is available at the better ones online now. For several years I figured mine on paper as well and came out either the same, or the software found something I missed (only happened once).

Also, I seriously doubt I will be itemizing ..even this year. We'd be hard put to come up with anywhere near over $10,300 (our standard deduction without itemizing), much less exceeding it. Can you explain why you say all OTR drivers should itemize?

 

Assuming you are out on the road for 300 days out of the year (which isn't that uncommon), that is $11,700 right there. Add to that any medical expenses (including any medication - over the counter included), any child deduction, etc., and you are already well above the standard deduction.

 

Hmm, good point. I think I'm starting to see why companies paying the per diem within the paychecks is a bad thing....Sorry if I'm a little thick headed on this one, I'm having trouble grasping it for some reason...

 

Companies love per diem for several reasons:

1. They end up paying less tax
2. They end up paying you less per mile for the privelage of letting them pay less tax
3. Your Social Security gets shot down about 10 grand a year for the privelage of letting them pay less tax
4. You end up paying some of the tax that they would have had to pay

Don't get me wrong - per diem CAN work, in certain situations. It all depends upon several things:

1. How much per mile you are going to have to give up to be in the program (less is better - anything over $0.02 should be avoided)
2. How much income your household brings in.
3. How much your household has to itemize with (a driver who doesn't itemize should NEVER take a per diem pay, as the tax is due on all the money if you don't take your standard meal deduction)
4. How well a driver can budget that money, and save for that potential tax bill

 

Thank you so much! It finally makes sense! :lol: I'm not too terribly concerned about the social security, or the tax, but the idea that (in our case) they basically get to pay him 20 cents a mile, rather than the 30 they quote, and get a tax break out of it is rather disturbing.

 

THEY ARE TAKING $0.10 PER MILE AWAY TO GIVE HIM PER DIEM??????


RUN, DON'T WALK AWAY FROM THAT COMPANY!

 

Ummm....yah, can't do that right now unfortunately. A leave is in the plans, but for right now he's got a shaky work history, 1 speeding ticket, and only 3 months or so experience. It was who would take him at the time, and we didn't have a clue that the per diem would be a bad thing, so for right now we're stuck. Looking at switching over in 3-6 months or so..and will watch for the per diem this time.