Trucker Tax Tips, Part 2: Use Your Powers of Deduction to Slash Your Taxes

Welcome to part 2 of our 4-Part Tax Primer for Truckers created by Trucker Path and the tax experts of ATBS.

In this post we’ll talk about a topic truckers love: deductions. Knowing the deductions available to owner-operators can help put you on the road to minimizing the amount of taxes you’ll owe the IRS.

Tax deductions are business expenses you can use to lower your amount of taxable income which in turn lowers your taxes due. Eligible deductions are expenditures that are “ordinary and necessary” for your business and you have a record confirming.

Here are a few of the potential deductions that are particular to truck drivers.

Meals Deduction

Self-employed drivers who are away from their “tax home” overnight, or who are required to rest by hours-of-service rules, are entitled to a per diem deduction for meals.

The deductible per diem rate as of October 1, 2021 is $69 for a full day of work and $51.75 for a partial day of work. Partial days are the days that you depart and the days that you arrive home. For 2022 taxes, drivers can deduct 100% of the per diem rate, but starting in 2023, only 80% of the per diem rate will be deductible.

Truck Depreciation Deduction

Another key deduction available to drivers who purchase a major asset like a truck or trailer is depreciation. Depreciation is an accounting method for spreading the cost of an asset out over its useful life. It can help reduce a tax bill considerably.

Other Potential Deductions

● Lease payments on a truck or trucks

● Diesel

● Tools and equipment

● Hotel expenses when work requires sleep to complete the duties of a job

● Fees paid for services like accounting

● Office or computer supplies

● Truck maintenance fees

● Uniforms

● Licensing and permitting

● Internet and cell phone fees directly related to business

● Commercial auto insurance premiums

● Truck washes or cleaning products

Don’t Let Deductions Go to Waste

Be mindful of the expenses you incur that are directly related to your trucking business and save those receipts. If you have any questions, consult a professional. Right now Trucker Path is offering a special discount for Trucker Path users on tax and accounting services from ATBS. Learn more here.

Next Up in Our 4-Part Tax Primer for Truck Drivers Series: Good Tax Habits

Managing deductible expenses is an important part of adopting good tax habits. Learn best practices for staying organized and on top of your taxes in our next post.