Tax time can be stressful for a lot of people. Worrying about getting everything together and filing on time can cause a lot of undo stress. For OTR truckers there are many things to be aware of when doing taxes. There are many tax deductions and allowances available to OTR truckers whether they are owner/operators or company drivers. The best way to insure you receive all the deductions you are eligible for is to have a tax preparer that specializes in OTR truck taxes. Having someone who knows the basic deductions and is used to filing trucker taxes will help make the process a lot easier.
Another way to make the tax season easier is to keep neat records and be organized. The more organized you are throughout the year the easier it is when tax season comes. Supporting records are very important in the trucking industry. Keep receipts for anything you purchase to use in, on, or around your truck. Also, keep accurate log books. In case of an audit these are proof of your actual days spent on the road. Having all the paper work for your expenses will insure you get all the deductions available to you. The IRS allows travel expenses for OTR truckers to help cover time spent away from home. These are ordinary and necessary items used during travel excluding items that would be considered lavish. Most things purchased for your truck are considered deductible. If you are unsure about an item contact the IRS to be sure. There can be penalties from using an item as a deduction if it is later ruled nondeductible.
Some example deductions are: Antennas, batteries, binders, blankets, briefcase, calculator, CB repairs, CB radios, chains, chrome things, cleaning supplies, flashlights, gloves, hand tools, laundry, lights, log books, luggage, lumpers, maps, motels, office supplies, pens, permits, pillows, radio, refrigerator, repairs, ropes & equipment, safety equipment, safety glasses, scales, scanner, sheets, special equipment, stapler, staples, stereo, storage, sun glasses, tool boxes, truck organizations, truck parking, truck wash, truckers newspapers & magazines, TV, and uniforms. Basically anything needed to maintain your truck, some entertainment items, and administration expenses can be deducted. This is not a complete list by far; these are just a few examples. Ask your tax preparer for a complete list, or contact the IRS for one.
One important thing to note as a trucker is where your tax home is. Without a physical address to use as your tax home you will not be entitled to travel expenses. A PO Box is not a valid tax home. You must be able to provide proof of expenses paid at your tax home. Using a relative’s street address as your tax home is only valid if you pay that person an equal amount as a room in that area and stay at that residence when you are not on the road. Truckers who live in their truck with no valid tax home are not eligible for travel expenses.
OTR truckers are also able to deduct a Per Diem. The per diem is an amount allowed by the government to cover meal and travel expenses. The per diem is calculated by multiplying the per diem rate for that particular area by the number of days spent on the road. This makes up the per diem deduction. Taking the standard deduction relieves the trucker of having to keep records and receipts for meals and travel expenses. Most truckers find the rate able to cover actual expenses.
Trucker taxes can be confusing. Keep accurate, detailed records in case of an audit. When doing your taxes yourself watch and make sure you get all the deductions. Saving money should be at the top of anyone’s list. Also, investing in 12 volt appliances can help reduce the amount of money spent during the year. You can find almost anything you might need to live comfortably away from home available in 12 volt. Reducing the amount of money you shell out during the year in anyway possible is rewarding in itself. Tax time will probably always bring stress, but when you are informed and organized things will run smoother.