First, what is a tax deduction? Essentially a tax deduction is a work-related expense that lowers your annual reported income. That usually means, less tax owed by you.
If you’re a driver in the trucking industry, you’ve probably run into various expenses out on the road this past year. As stressful as taxes can be, tax time is your chance to claim deductions and get some of that money back.
Tax Home Requirement for Truck Drivers
Before a truck driver can claim a deduction, the IRS requires that you have a “tax home,” or address to list on your tax return. This is usually the address where you receive your mail. It could be your business’ headquarters or a personal residence. However, regulations say that you must regularly contribute towards that residence.
In short, without a tax home, you will not be allowed to deduct business and travel expenses.
Truck Driver Tax Deductions
Remember, you can only claim deductions on unreimbursed expenses.
- Travel Expenses – Includes hotels, meals, and more. There are different methods for recording these expenses. Check out IRS Publication 463 for more details. If you already use the standard allowance method, you can calculate your daily lodging, meal, and incidental expense allowance using the per diem rate tool.
- Vehicle Expenses – Most of what you need to keep your office-on-wheels running is deductible. Includes maintenance such as oil changes and new tires, as well as needed repairs. If you own your rig, you should be able to deduct depreciation amounts year to year.
- Fuel – This one has some restrictions. If you paid more than $100 out of pocket for fuel and were not reimbursed, you can deduct some of that amount using standard mileage rates. Remember that it has to be for business purposes. Commuting costs are not deductible.
- License and Regulatory Fees – Costs associated with obtaining and maintaining your CDL. Also, the cost of any required classes or training to further your job education are generally deductible.
- Union and Trade Association Fees – Required union and truck driving association group dues are usually deductible. In some cases, even voluntary membership dues are deductible if the membership helps you do your job.
- Medical Exams – You’re likely required to visit the doctor for a DOT physical, drug test, or maybe even a sleep apnea study. If you pay out of pocket for any of those, the costs are generally deductible.
- Office Supplies – Traditional office supplies like pencils, binders, and calculators can often be deducted as a business expense. You may also be able to deduct costs for job-related office services such as faxing and photocopying.
- Trade Publications Subscriptions – As long as the magazines or journals you subscribe to are directly related to your industry, they can usually be deducted. If you have load board subscription fees, they may also be deductible.
- Load Securement – You can usually deduct the equipment you need to secure your precious cargo. A great excuse to get some new ratchet straps, bungee cords, chains, and tarps.
- Electronics – Generally deductible when used only for work purposes. Examples include your CB radio, GPS, GPS map updates, and your ELD. Also, repair costs for these devices are often deductible. You probably use your cell phone, data plan, or laptop for both business and personal reasons. Therefore, these items are usually only 50% deductible.
- Tools – This one is almost too good to be true. Your tax return can usually include deductions for almost any roadway tool your job requires: duct and electrical tapes, hammers, pliers, tire irons, and more.
- Clothing – You can usually deduct items if you need them to perform your job. Specialized clothing such as overalls, rain gear, safety glasses, safety vests, and hard hats all fall into this category.
- Sleeper Berth – On long trips away from home, you need this off-duty space to prepare for your next shift behind the wheel. Save receipts for items like bedding, alarm clocks, cab curtains, and mini-fridges, as these items are often tax deductible.
- Personal Care Items – Hygiene products like soap, toothpaste, razors, and even first-aid equipment. Keep in mind that shower and laundry cleaning costs can also be deductible.
- Cleaning Supplies – Just about anything that keeps your rig sparkling clean and ready for service. Towels, window cleaner, trash bags, and even a personal vacuum can all be tax deductible.
Claiming your Truck Driving Deductions
In conclusion, it’s important for truck drivers to be aware of and take advantage of the industry-specific tax deductions available to them.
However, everyone has unique employment and tax situations. This post does not intend to provide any specific tax advice. Please consult a tax professional if you have specific questions on what deductions apply to your situation.