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Per Diem Pay

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Truckerwife723

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Hubby just called and they just told him that the 50 cents per mile they told him he would be getting is not exactly that. It's 40 cents per mile and then 10 cents per diem.

What does this mean? Any help with this would be greatly appreciated.

Michelle
 
It usually means that he'll still be getting the .50/ mile. But they'll only be taxing .40/mile. The other .10 will be tax free. But he wont be able to claim the meal exemption on your taxes next year.
 
No. You know how truck drivers can deduct like 52.00 a day for meals? This takes the place of that. If a driver is away from home for 250 days a year multiply that by 52 dollars. He can deduct like 13000 dollars from his income for meals. But you only get a percentage of that to deduct. But when you get per Diem pay, if you run 125000 miles a year at .10/mile thats 12500 dollars thats not taxed. Turns out to be a better deal. The numbers here may not be exact but you should have an idea of how it works now. Hope this helps.
 
Just be careful in stating your income on any loan applications etc....I doubt if lenders will count per deim as salary.
 
I am new at the per diem stuff and was wondering if at the end of the year am I still entitled to the standard deduction if I don't itemize deductions?
 
Per diem is a losing game. You lose on workermans comp you lose on social security you lose the tax deduction for road expenses. There may be a slight deduction on your 2106 form after you do the math.

Now for the employer is is a winning game. They save on social security taxes on workcomp and they get the tax deduction.
 
Per diem is a two edged sword though...another advantage is you get 10 whole cents with the perdiem, if the deductions were taken out ; you would only get .06 to .07 of that . Consult with an accountant or taxperson to fully comprehend the total ramifications of this pay arrangement. Our situation is : we return to the home terminal daily (with very few exceptions) so , we (our company's drivers) can't deduct meal allowances anyway.
 
JMBCMP said:
Per diem is a losing game. You lose on workermans comp you lose on social security you lose the tax deduction for road expenses. There may be a slight deduction on your 2106 form after you do the math.

Now for the employer is is a winning game. They save on social security taxes on workcomp and they get the tax deduction.
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EXACTLY!!!
Be careful!
 
Lyv Wire said:
Per diem is a two edged sword though...another advantage is you get 10 whole cents with the perdiem, if the deductions were taken out ; you would only get .06 to .07 of that . Consult with an accountant or taxperson to fully comprehend the total ramifications of this pay arrangement. Our situation is : we return to the home terminal daily (with very few exceptions) so , we (our company's drivers) can't deduct meal allowances anyway.
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I am a company driver that comes home every day I get to take the meal allowance ($52)!! My tax lady said since I am gone over night and I leave the state I get the allowance!! We had a driver get audited by the I.R.S and he was doing the same thing and he didn’t have any problems!!
 
I wonder what happened to all the posts that used to be on cowan?....Did the powers to be get hold of the web site and tell you guys not to go on it or that they are watching it? just curious
 
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