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One way that truck drivers can offset some of their earnings and receive a tax deduction is to use the per diem allowance established by the Internal Revenue Service. This information is published in IRS Publication 463 and establishes the limits for daily meal deductions that truck drivers can take. Employers, on the other hand, adhere to Publication 1542, which establishes the maximum per diem rates the employer can pay the employee as a reimbursement of expenses.
You Have to Qualify
To qualify for a tax deduction on a per diem basis, you must first meet the requirements established by the IRS. In general, you must be a transportation worker whose job requires that you be away from home on a regular basis. Furthermore, you must be away from home longer than the hours in a normal day's work. If you start and end their day where you live, you are not generally eligible for a per diem deduction. The IRS instead requires that your job causes you to sleep away from home for a substantial period of time.
No Double Dipping
You can't get tax deduction for travel expenses if you receive reimbursement from your employer. This reimbursement is generally a payment made on a per-mile basis, but trucking companies may use per diem reimbursement instead. Allen Smith of AsktheTrucker.com notes that companies used to pay drivers a per diem allowance above their regular pay. When payment comes as an expense reimbursement and not regular income, you see a reduction in your taxable income. This can adversely affect your finances because you can't report the reimbursement as income when applying for a loan.
The IRS specifies per diem allowances that you can deduct from your taxable income, thus reducing you tax liability. You can take these when your company does not provide its own standard per diem allowance. Publication 463 indicates that the standard per diem meal allowance is $46 per day, as of 2013, for most small communities. More money is allowed in other metro locations throughout the country. This information is listed in Publication 1542 You can take a per diem deduction for meals and all incidental expenses as one expense, rather than itemizing them. As of 2013, the IRS standard per diem rate is $251 for all qualified high-cost locations and $170 for all other locations.
If you take the per diem deduction for meals alone, you must prorate the deduction for the days in which you are away for less than 24 hours. Generally, the prorated amount is three-fourths of the standard allowance on the day that you depart from your home or place of work. The day you return is not counted in the per diem deduction. Instead, the same three-fourths rule is applied to the day before you return home.
- Internal Revenue Service: Publication 463
- Ask the Trucker: Per Diem or CPM?
- Internal Revenue Service: Per Diem Rates
- U.S. Cargo Control: Log Books and Inspection Reports
- U.S. General Services Administration. "Frequently Asked Questions, Per Diem." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "Federal Travel Regulation, Section 300-3.1," Pages 22 and 71. Accessed Nov. 25, 2019.
- U.S. General Services Administration. "M&IE Breakdown." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Georgia." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for Illinois." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "Factors Influencing Lodging Rates." Accessed Nov. 25, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Rates for New York." Accessed Nov. 29, 2019.
- U.S. General Services Administration. "FY 2020 Per Diem Highlights." Accessed Nov. 25, 2019.
- Internal Revenue Service. "Notice 2019-55," Page 3. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Per Diem Payments Frequently Asked Questions," Page 2. Accessed Nov. 25, 2019.
- Internal Revenue Service. "Topic No. 511 Business Travel Expenses." Accessed Nov. 25, 2019.
Jared Lewis is a professor of history, philosophy and the humanities. He has taught various courses in these fields since 2001. A former licensed financial adviser, he now works as a writer and has published numerous articles on education and business. He holds a bachelor's degree in history, a master's degree in theology and has completed doctoral work in American history.