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Expediters Online.com Dollars & Sense
REMEMBER-we are not recommending you buy a home (that is not our business). We are attempting to put forth the tools you may need in making your own evaluation since so many of our clients have asked. Question: I'm a company driver but I don't know what expenses are deductible? Answer: While self-employed truckers can deduct most expenses incurred to earn their income, a company driver is limited to expenses necessary or required to perform his job. He or she can deduct per diem and motel, laundry and uniforms, gloves, logbooks, maps, cell phone, CB, tools or any expenses incurred that are necessary. You must reduce the expense deduction of the above items if you were reimbursed for any expenses claimed. You also have to be aware if any part of the reimbursement was included in your W-2 income. The above expenses are shown on your tax return as itemized deductions and cannot be claimed if you take the standard deduction. If questioned by the IRS they may request a letter from your employer stating you had to incur the expenses that you claimed. Question: I am an over the road trucker. Do I need to save all my food receipts? Answer: As an over the road trucker you may deduct your actual cost for meals with receipts or deduct the IRS per diem allowance using your logbooks as substantiation 80% percent of your total is deductible regardless of which method you choose. This is also true for company drivers. Corporate shareholders are not entitled to use per diem and must use actual costs. TAX TIP You may have overpaid your taxes by failing to itemize! A new study finds that as many as 2.2 million filers could have cut their tax bills by claiming itemized deductions (for items such as mortgage interest, property taxes, state and local taxes, and charitable contributions). But they, or their preparers, failed to do so and used the simpler standard deduction instead. Their overpayments may have totaled almost $1 billion. If you didn’t itemize on your return within the last three years, check to see if the total itemized deductions you could have claimed exceeded the standard deduction. If so, you can file an amended income tax return to take your extra deductions now – and get a tax refund. This article has been presented by PBS Tax & Bookkeeping Services, a company that has been providing income tax and bookkeeping services to the trucking industry for over a quarter century. If you would like further information, please contact us at 800-697-5153. See our website at www.pbstax.com. Please remember everyone’s financial situation is different. This article does not give and is not intended to give specific accounting and/or tax advice. Please consult with your own tax or accounting professional. © Copyright 2005 by Expediters Online.com |