Truckload carrier per diem pay for drivers is an Internal Revenue Service (IRS) designation covering reimbursement for drivers’ meals and incidental expenses while they are in transit. Drivers are paid a per diem for every mile and generally paid monthly, reducing their taxes and increasing take-home pay.
Per diem tax reform became law on December 22, 2017. And effective October 1, 2021, truck driver per diem rates experienced the first increase in three years (rates went up to $69 for any locality of travel in the continental U.S. and $74 for any locality of travel outside the continental U.S.).
How the new IRS per diem rules impact truckload carriers and their drivers
The 2021 tax reform has changed miscellaneous itemized deductions for individuals’ non-reimbursed business costs. The per diem allowance is no longer allowed as an individual deduction. This change in the tax law eliminates the per diem allowance some drivers previously deducted on their personal itemized tax returns.
Additional truckload carrier per diem considerations include:
- For some truckload carrier drivers, there’s a likelihood of slightly reduced Social Security, unemployment, and workers’ compensation benefits.
- The per diem portion of income is generally not eligible for 401(k) matches, but some companies have per diem pay plans that help drivers redirect per diem income into tax-deferred savings.
- Apps that allow drivers to upload documents, avoid keeping track of pieces of paper, and ensure the information is stored and available when needed help improve record-keeping.
- Company drivers’ deductions are only available if they itemize, not if they take the standard deduction.
- Self-employed truck drivers can generally deduct any expenses incurred to earn their income. However, company truck drivers are limited to non-reimbursed expenses their employer requires.
- According to OOIDA, company truck drivers may be able to itemize unreimbursed expenses like uniforms, gloves, logbooks, maps, cell phones, CB, tools, Windex, paper towels, showers, etc.
The Axele TMS and Mobile Driver App help truck drivers keep track of documentation. Easily uploaded documents are available as needed, either via mobile devices or in the home office. Contact Axele TMS today.