It's not easy being a truck driver. You may spend more money out of pocket than many professionals do for their employment, from getting your trucking business license or commercial driver's license to long hours on the road to handling vehicle upkeep and repairs. You might need to know all your deduction and write-off choices when tax season rolls around.
Only self-employed truck drivers are permitted to deduct costs from their taxes due to recent amendments to the tax code. You must not be a corporation driver but rather a contract driver or owner-operator to be eligible.
You are a business driver if you receive a W-2 Form, which means that none of your work-related costs is tax deductible. But, you can utilize these documents, along with your income and spending records, if you receive one or more 1099 Forms, to make these trucker tax deductions. For your income and spending, a Schedule C Form is required.
You can deduct commercial motor liability, property damage insurance, and loss of cargo insurance for business interruptions. Essentially, any trucking-related insurance is considered a company expense. If you pay for your own health insurance, you can deduct it separately from your corporate expenses. The cost of your health, vision, and dental insurance for you and your dependents may be deducted from Schedule 1 of Form 1040.
Generally, drivers must pass regular physical and medical examinations in order to work. Any medical examinations or treatments, such as individual hospital visits or prescription drug needs, are taxed as personal costs rather than corporate expenses.
Long-haul or local truck drivers are typically eligible for this deduction, which allows them to deduct up to 50% of their meal costs. You may deduct up to 80% of meals bought while traveling if you are within the "hours of service" restrictions. You may also use the per diem approach to claim a set amount each day, though this varies depending on where you are. The General Services Administration's per diem rates are used by the IRS even though it maintains different rates for each city and state. Often, local truck drivers won't be eligible.
Truckload dispatch costs are allowed for the deduction, but just like other allowable expenses, you must keep track of them throughout the year. If your local or state government mandates that you have a business license, you may also deduct the cost of your licensing charge in addition to dispatch costs. You can also deduct the expense of keeping up any additional licenses you need to operate your business, such as your commercial driver's license.
Fuel and other trucking-related expenses, including tolls and parking fees, are deductible as long as they are relevant to your job. If you have to spend the night away from home due to long hours at work, you can also claim your hotel expenses. But bear in mind that, unlike meal expenditures, housing charges do not qualify for a per diem, so be sure to save your receipts so you can claim your costs.
You can subtract the expense of getting your CDL. However, you may also write off the costs of attending a truck driving school or getting additional training or certifications to get your CDL and keep it current. Your expenses for additional education that is specifically linked to your line of work might also be tax deductible.
A truck driver's tax deduction will depend on the regularity and necessity of an item for business reasons, as well as if you have a record of your spending. Keep copies of your receipts and any supporting documentation to substantiate the expenses you list on your tax return.
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