Taxes can be a headache for everyone but especially challenging for those that who self-employed. When it comes to the trucking industry, there are no exceptions. Owner-operators should be aware of some crucial items. Truckers have unique tax returns and incur several business expenses, meaning they can lower tax liability by utilizing certain deductions.
Running a successful operation and filing a proper tax return is possible when you have a clear idea of your options.
If you’re an owner operator, read on to ensure you understand what deductions you qualify for. Below we’ve listed common business expenses the IRS will allow truck drivers to deduct.
Owner-Operator Tax Deductions
- Union/Association Fees: Fees that come from any trucking industry organization are generally accepted.
- Uniforms: This includes specialized work gear such as protective gloves, goggles, or boots as well as cleaning expenses that occur when you’re away from home.
- Truck Maintenance: New tires, oil changes, cleaning supplies, etc. may qualify for a deduction. If you do your own repairs, you cannot deduct for labor, only the materials.
- Sleeper Berth: If you use a sleeper berth you can deduct items including bedding, cab curtains, alarm clock, mini refrigerator and first aid supplies.
- Satellite Radio: Subscriptions qualify for deductions since truckers use satellite radio for traffic and weather information.
- Work-Related Fees: A few of the most common include, but are not limited to, driver license renewals, DOT physical exams and sleep apnea study costs.
If you’ve been in the industry a while, then you’re likely familiar with the costs listed above. What about some of the lesser-known and under-utilized deductions truckers can take?
Are you aware of these tax write offs for owner operator truck drivers?
- Licensing Fees: Because you’re required to have a CDL to drive in the U.S., you can qualify the costs associated with obtaining and maintaining your CDL, such as training programs.
- Retirement Plans: Contributions to an IRA or Keogh plan for yourself or a spouse may be deducted.
- Subscriptions: If you subscribe to any publications related to trucking, the IRS allows self-employed drivers to count these as a business expense as they cover new and emerging trucking regulations.
- Casualty Financial Loss: You may write these off on taxes if your trucks or other assets suffered damage due to an accident or extreme weather.
- Meals: In 2017, self-employed truck drivers were allowed to deduct $63 per working day if they ate away from home.
- Loan Payments: Leasing fees, insurance premium payments, and interest payments made on loans used for a truck’s purchase can go towards your deductions.
- Internet Fees: WiFi-enabled laptops and smartphones are a true necessity for self-employed drivers who are on the go. For this reason, the IRS will allow a 50 percent deduction on the access fees.
Keep these these tax write offs for owner operator truck drivers in mind throughout the year so that you can stay organized. Doing so will help you on your tax return. We hope that this short guide will be helpful as you continue to run your own operation and prepare your business’ taxes. If you’re a self-employed truck driver, we have tons of resources to make finances easier for you like same-day funding with our freight factoring.
Learn more about freight factoring or sign up for access to our Load Board here!