Discussion:Truck Drivers Per Diem

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Discussion Forum Index --> Tax Questions --> Truck Drivers Per Diem


Deanp (talk|edits) said:

20 January 2006

I have a client who is an over the road semi-truck driver. He drives a company truck (he does not own his own truck). The per diem rate in ND for meals and IE is $31. Lodging is $60 I believe. He sleeps in the truck so I don't believe that he can use the lodging part, but can he use the $31 for every day that he was out in 2005?

Dusty (talk|edits) said:

20 January 2006
I will be interested to hear what the experts have to say but I thought they had to be gone more than 100 miles away from home and more than 10 hours.

Deanp (talk|edits) said:

20 January 2006
That is not a problem he goes all over the country and is rarely home.

KAM (talk|edits) said:

20 January 2006
I would let them have the meal allowance

Tminco (talk|edits) said:

21 January 2006
Yes he can take the per diem meal allowance. He also will qualify for the transportation worker rate of $41.00 per day if he travels in areas that have different per diem rates.

Also...he will qualify to use 70% of the deduction instead of 50% if he is subject to DOT hours of service rules.

Deanp (talk|edits) said:

21 January 2006
He travels to all 48 states during the year. He can then take $41 per day? Also, he was wondering if he can claim the expense for Sirius radio and satellite TV.

TLF (talk|edits) said:

22 January 2006
If he uses the radio to obtain weather conditions to the place he is going, then yes he can take a deduction for the radio, but not the t.v.

Also when I first started preparing taxes nineteen years ago, there was a requirement that truck drivers could not be away from their tax home for more than 30 consecutive days to be able to claim the standard meal allowance. so they had to return to their tax home at least 1 day every 30 days. I'm not sure that still applies.

Sw (talk|edits) said:

February 7, 2007
I have several truck driver they are usually gone 12-14 hours but not overnight. The company that are driving for are telling them they can claim 1/2 of the per diem. I have never heard this before anyone eles know if this is correct???

Deback (talk|edits) said:

February 7, 2007
I think so, Sw, if they need to rest for awhile, but I can't remember the exact details on this right now. Check out Publication 463.

Swortmann (talk|edits) said:

26 February 2007
If the driver takes the M & IE per diem rate do they still have to reduce it to the DOT 75% requirement?

Deback (talk|edits) said:

February 26, 2007
Yes - Deduct $52 per 24-hour period and then check the DOT 75% box on Form 2106.

Dmgarr001 (talk|edits) said:

19 March 2007
Is the per diem a given allowance or does the trucker have to actually incur the meal expense?

Waynecpa (talk|edits) said:

19 March 2007
They would fall under the sole proprietor rules and don't have to actually incur meal expenses (although I can't imagine a truck driver not eating in a 24 hour period).

Dmgarr001 (talk|edits) said:

19 March 2007
It's not that the trucker does not eat, however he often buys can goods, deli meats and other food items from a WalMart, grocery, etc., as he is traveling since he has a small refrigerator in his trucker;so most time he does not stop at diners, restaurants, or other eateries.

Hadlin (talk|edits) said:

19 March 2007
I would follow deback. 52$ and dot rate

TaxNerd (talk|edits) said:

19 March 2007
The truck driver could be on a seven day fast; he still gets the per-diem deduction.

Dmgarr001 (talk|edits) said:

19 March 2007
Thanks TaxNerd for your input and clarification. Thank you Hadlin and Deback for your valuable information and recommendation.

MeAgain (talk|edits) said:

11 April 2007
So, let me get this straight... Even if a OTR driver does not own his own truck, and receives reimbursement from his employeer for meals, he can still claim the per diem deduction at 75% this year?

Kevinh5 (talk|edits) said:

11 April 2007
reduced by reimbursement, of course, on the 2106 if an employee, or Sch C if self employed

Jdugancpa (talk|edits) said:

11 April 2007
I'm late to this party and don't have any OTR truck drivers for clients. Having said that, I don't think he gets to be reimbursed from his employer (you did not specify, but I am inferring you mean he is reimbursed on an accountable plan basis) AND take the per diem deduction. The reimbursement from an accountable plan comes to him tax free. He does not then get to utilize a per diem rate to take additional deductions. One or t'other, not both. If, OTOH, he is reimbursed under an NONACCOUNTABLE PLAN and the reimbursement is included in his W-2 taxable wages, then yes, he can utilize the per diem deduction.
  • Posts from a non-tax pro were moved to a related per diem discussion here.

Taxalmancer (talk|edits) said:

20 December 2009
I found this thread while searching and thought I would comment. Several people above seemed to believe that it is ok to claim a M&IE per diem of a trucker is on the road for 12-14 hours and returns home that day. Perhaps a 1/2 day per diem.

My understanding after reading Rev. Rul. 75-168, Bissonnette v. Commissioner and U.S. v Correll is that there must be a layover period long enough for "substantial sleep or rest".

I would be very surprised if any 12-14 hour day would qualify under the above requirement.

Illini (talk|edits) said:

22 December 2009
When I was in the Air Force -- we turned in travel vouchers for our per diem checks -- we got credit for each quarter of a day we were traveling. For example, if our flight took off at 5:59 AM we got credit for the midnight to 6 AM quarter. If we took off at 6:01 AM we did NOT get the earlier quarter, instead we got the 6:00 AM to Noon quarter. Same thing on calculating our return trip -- if we touched down at 6:01 PM we got the 6:00 PM to midnight quarter. If we touched down at 5:59 PM we would miss the 6:00 PM to midnight quarter.

I think we got paid for day trips, even if we were not out over 24 hours. I think they went by the number of meal periods we were out 6AM was breakfast, noon was lunch, 6 PM was supper, so we could rack up one, two, or three meals depending on how our total quarters away from home came out. We of course were always more than 100 miles away from home, so I think the mileage factor was a gimme.

Imagine the games we played trying to take off early and land a few minutes late if it effected our per diem checks!

Death&Taxes (talk|edits) said:

22 December 2009
"If the nature of the taxpayer’s employment is such that when away from home, during released time, it is reasonable for him to need and to obtain sleep or rest in order to meet the exigencies of his employment or the business demands of his employment, his expenditures (including incidental expenses, such as tips) for the purpose of obtaining sleep or rest are deductible traveling expenses under Section 162(a)(2)" This from Williams versus Patterson, a 1961 case and one which the Tax Court referred to as the "sleep or rest rule" in Bissonnette. Williams' day was 16 hours; he was a railroad engineer making round trips between Montgomery AL and Atlanta GA, with a six hour layover in Atlanta before starting back. Williams day was 16 hours.

I think the layover would be a requirement, but what is a layover? Cellist Abigail Smith leaves her home in Wilmington DE at 8am and takes a train to NYC for a orchestra rehearsal (job is temporary, or rather one of many groups for which she plays). The rehearsal is at 11am and lasts until 2:30pm. She returns to Symphony Hall at 7:00 pm to play the concert for which she rehearsed. Concert lasts until 9:45; she catches a train home at 10:30. In between rehearsal and concert, she ate dinner. As he puts it, "I need sustinence to play my cello and keep my mind alert, and I couldn't go home." Waddya think?

Illini (talk|edits) said:

23 December 2009
Layover is simply the "dead time" spent waiting for the next "work related task" to occur. When flying, a layover was usually a night in a hotel, but we also spent hours on the ground waiting for the next load of passengers or cargo to arrive before we could takeoff again. We had a maximum crew duty day of 16 hours (24 hours if supplemented with extra crew members), which includes the time you show up for duty until you touch down for the end of the day to enter into mandatory crew rest at the end of your "crew duty day".

Illini (talk|edits) said:

23 December 2009
IMO she has a legitimate claim for meals away from home. She had breakfast at home, but she can claim lunch and supper (2 quarters or half a day) of per diem.

Illini (talk|edits) said:

23 December 2009
(meals and incidentals -- no lodging)

Ddoshan (talk|edits) said:

23 December 2009
I don't think the cellist would be allowed any meal allowance by the IRS and or a Tax Court. Or by me for that matter but then some think that I am not a very nice guy.

Illini (talk|edits) said:

23 December 2009
http://www.smallbusinessnotes.com/fedgovernment/irs/463/perdiem.html

I did find one reference, however, that states you also must be remaining overnight to collect per diem.

If your musician had spent the night and returned the next morning, she could have claimed 1 1/2 days of per diem. (Note the IRS Pub allows 3/4 day of per diem on the first day of travel away from home and the return day. So she would have been eligible to claim 3/4 of a day for each day.)

Death&Taxes (talk|edits) said:

23 December 2009
Is it the 4 1/2 hours versus 6 hour layovers in Bissonnette that makes the meal not deductible, or the fact that it is a meal rather than a hotel room (Williams)? Here is the court in Bissonnette:

"The Court of Appeals for the Fifth Circuit concluded that on account of the length of the taxpayer’s workday (16 hours), 8 the duration of his layover (6 hours), and the responsibility of his position, it was necessary for the taxpayer to rest during his layover in order to carry out his assignment, even though no statute, regulation, or railroad rule required him to sleep or rest before his return trip. Id . at 337, 339. Furthermore, the court reasoned that the phrase “away from home” does not require a person to actually be away overnight. The court held that the costs of meals, lodging, and tips during the 6-hour layover were deductible."

The IRS acquiesced in Williams.

The Court goes on to differentiate this from Barry (54 TC 1210) where the man worked 16-19 hours a day and took his break in his auto. The Court ruled for the Commissioner, and in doing so noted that meals are not deductible if taken in the office, like many of us do. The Court also notes "However, the released time must be of a sufficient duration that it would ordinarily be related to a significant increase in expenses" citing US vs. Correll.

So if the instrumentalist rents a room, does that make her more like Williams.....that seems a bit assinine? Or she might have a friend in Brooklyn and stay overnight, returning early the next day. Does that change matters?

Where I see this issue is when local musicians tell me 'the meals are between rehearsal and concert' but they live in the same town. That is a no-no, and I let them know I can't deduct my meal when I work on their returns until 10 or 11 pm.

Villageidiot (talk|edits) said:

24 December 2009
The per diem rate for a DOT worker is 52.00 per day for the first 3/4's of 2009 See REV PROC 2007-63 the new tate effective 10/01/2009 is $%59.00 per day see REV PROV 2009-47 as long as the OTR driver exceeds the hours of limitaion for a Over The Road Driver he/she may deduct the per diem . The log Books are essential to maintain per diem decductions . Make sure the Over The Road Driver keeps the Log Book for at least 4 years after the close of the tax year .The reduction is 20% not 25% as stated above so 80% of the deduction is retained by the OTR Driver for 2009 .
    There are several ways to determine the total per diem  deduction for a OTR driver but after several tries at each possible way  I use the 1/2 day for the for day of departure and 1/2 day for the return day and a full per diem for each day in between , it works out rather well rather then try to use the hours of limitation for each trip involved on a daily basis .

VI§TCC

Dap19 (talk|edits) said:

24 December 2009
I have tried searching but not found the specifics of my situation. In order for a trucker to qualify for the $52/$59 meal rate does he have to actually drop/receive loads and rest in places with differing rates during the same trip? Or does the phrase "travel to areas with different per diem rates during any one trip" mean something as basic as just traveling through the other cost areas? This individual starts at point A eligible for one per diem rate and empties, reloads, rests, etc. at point B for one or more nights which is another rate. He then returns to point A. Along the way he may pass through other cost locals, but doesn't rest/sleep there.

There are also times where he will spend nights at other cost areas, but only one location per trip. Thanks for your help.

Villageidiot (talk|edits) said:

26 December 2009
The DOT ( Department of Transportation ) regulates OTR drivers and determines how many hours a driver may drive the truck before he/she stops for a required rest period under the DOT Regs . When the hours of limitation are exceeded and the driver is required to stop he/she gets a $52.00 meal deducction , it does not change by Town ,State or City in the USA the only other rate is if the drivers stays overnight in Canada or Mexico then the Non Conus rates would apply .
     The driver gets the deduction when he/she is away from home and the hours of limitation are exceeded this includes weekends ,layovers ,bad weather outages or any other problem that keeps the driver from continuing on his way . 
    I had several drivers sitting in a WAL MART parking lot in NC after The Katrina Hurricane and they all got their Meal deduction for the two weeks they sat in the parking lot and never moved . GOD Bless........ FEMA the truckers freind. 

VI§TCC

Villageidiot (talk|edits) said:

26 December 2009
I have a client who is an over the road semi-truck driver. He drives a company truck (he does not own his own truck). The per diem rate in ND for meals and IE is $31. Lodging is $60 I believe. He sleeps in the truck so I don't believe that he can use the lodging part, but can he use the $31 for every day that he was out in 2005?

The rate for 2005 was split $41.00 for the first 9 months see Rev Proc 2005-10 and $52.00 for the balance of the year see Rev Proc 2005-67 .

Tomblairea (talk|edits) said:

20 June 2011
The types and amounts that qualify for possible deductions from taxable income earnings by over-the-road truckers vary on the basis of the type of legal and tax entity of the business in operation. For example, sole proprietorships and partnerships commonly must use only actual expenditures for things like lodging and meals-entertainment-incidentals (ME&I) and interest paid on their partial-business use passenger vehicles, while (W-2) employees may enjoy more generous "per diems" for Lodging and ME&I based upon the actual number of "overnights" away from their tax home and where they drove to and from (and can actually prove ("substantiate") with an accurate and detailed log of such business-related expenditures including meals and entertainment, lodging, etc.

For example, the simplest (in my opinion) meals and intertainment per diem rates for W-2 wage earning truckers are as follows (and are claimed on Form 2106 Unreimbursed Employee Business Expenses located under Miscellaneous Expenses on the lower portion of the Form 1040, Schedule A): (This is only financially useful and tax saving if you qualify for and actually do itemize your tax deductions...if you use the "Standard Deduction" then forget about it)

The per diem rate in 2011 is 80% of $59 per day for overnight travel (80% of $59 = $47.20 net per qualfied overnight trip)--- The per diem rate in 2010 was 80% of $59 per day for overnight travel (80% of $59 = $47.20 net per qualified overnight trip)--- The per diem rate in 2009 was 80% of $52 per day for overnight travel (80% of $52 = $41.60 net per qualified overnight trip)--- The per diem rate in 2008 was 80% of $52 per day for overnight travel (80% of $52 = $41.60 net per qualified overnight trip)--- and so on (but tax years prior to three years back are "closed years" and cannot typically be amended...for example, tax year 2008 drops off as of April 15th 2012). For useful additional information, visit web site http://ooida.com/Education&BusinessTools/Resources/Per_diem_rate.shtml and also look up "Per Diems" on the IRS web site www.irs.gov

Caution: IRS tax return auditors commonly invoke the rule that says the first day out and the last day out on each and every trip logged qualify only for 75% of the overnight travel per diem allowance for W-2 wage-earning employees. Another (and even more accurate, in my opinion) way to calculate your per diems is to take the total "overnight hours" traveled in a year and divide it my 4 to arrive at the number of 6-hour shifts worked and then multiply that number into the base rate (For example: $59/4 = $14.75 per six hour shift, including gratuities and tips to waitstaff). If you had 4,340 logged trucking hours in total (out of approximately 8,760 hours in average calendar year), you can divide that 4,340 by 4 to arrive at the number of six hour shifts (4,340/4 = 1,085 6-hour shifts (drop all partial 6 hour shifts in this calculation and best also to always also round down) and then multiply that by the $14.75 per each 6-hour shift you would have a meals and entertainment deduction of $16,004. This method simplifies and commonly eliminates all and any of the guesswork over 75% of the first and last days of each trip rules that can over-complicate an IRS tax audit.

Imagine a better "short-hand" way how you could otherwise deal with a trip that required 140.00 logged hours of driving from start to finish each over 31 round trips in a tax year and prove it at an IRS audit and I'll modify my experienced and qualified opinion on this.

Don't use CONUS rules unless you work for the U.S. Government as a DOT worker. If you want to see (and probably also become further confused) what CONUS comes to and how it works with ME&I (Meals-Entertainment & Incidentals), you can also visit the GSA website. Just search "CONUS DOT Per Diems" and/or "GSA DOT Per Diems via your computer search engine.

Taocpa (talk|edits) said:

20 June 2011
I think the above post needs to be listed as an "article".

JMHO.

Tom

CrowJD (talk|edits) said:

20 June 2011
It's a masterpiece of its genre. If Blair didn't do a single thing for the rest of his life he could die contented. The only thing I would change is to put a warning toward the beginning just in case a trucker tries to read it going down the road and he falls asleep. Nevertheless, a masterpiece of its type. It's deserving of preservation.


Wwtaxes (talk|edits) said:

19 August 2011

I appreciate the above explanation - thank you!

I have what I'm sure you will consider a much simpler question. If an INTERSTATE trucker leaves and returns to his tax home every day, but also crosses state lines every day, does he get to take the per diem? This is the first trucker client that I have that isn't gone overnight. Publication 17 gives an example which would indicate he can't, but it also says that interstate truckers are eligible for the per diem. My first instinct was 'no', but now I'm questioning it.

94nole (talk|edits) said:

19 August 2011
How could you argue that he is away from his tax home every day? Isn't that the requirement to claim per diem? Not sure crossing state lines has any bearing on this.

Wwtaxes (talk|edits) said:

20 August 2011
My point exactly. I read the rules to say that they only get the per diem if they are gone more than 15 hours, and thus fall under the hours of service regulations. They are reading the rules to say that any interstate trucking gets the per diem. And it's not only the client saying this. HRB has allowed them this for years, and I did a search just to see what else I could find on the topic, and found this question answered by a CPA: http://www.picpa.org/ask/public/View.aspx?id=487&ReturnUrl=Search.aspx%3Fi%3D%26k%3D%26c%3D2 (of which I am not). Unfortunately, it's an answer, but has no reference to back it up. So I'm looking to see what I've missed. However, I've also found Q&A posts that say that they have to be gone long enough to require rest, which is what I told him initially. Any guidance is much appreciated.

Ckenefick (talk|edits) said:

20 August 2011
U.S. v. Correll, Homer O., (1967, S Ct) 20 AFTR 2d 5845 , 389 US 299 , 19 L Ed 2d 537 , 68-1 USTC ¶9101 , 1968-1 CB 64.

IRS Pub No. 463, (2009), p. 3 .

Barry, Frederick J., (1970) 54 TC 1210 , affd(1970, CA1) 27 AFTR 2d 71-334 , 435 F2d 1290 , 71-1 USTC ¶9126 .

Strohmaier, Walter R., (1999) 113 TC 106 .

Okie1tax (talk|edits) said:

20 August 2011
So, how many hours does he stop for rest/sleep to stay within DOT regs?

As for HRB allowing, can you tell me the class/course that says that? There may be an HRB preparer who allows that, but I don't think you will find it to be policy.

Note: I do work for an HRB franchise, so am prejudiced.

Wwtaxes (talk|edits) said:

21 August 2011
Thank you so much. I admit that I am too easily bullied, and I was really feeling bullied by this guy. I have been maintaining my position since March when I did his taxes, but he won't give up. Then when I found the above Q&A reference, I thought perhaps I missed some fine print somewhere (such as: they can take the per diem if they are interstate, travel only on Tuesdays and Saturdays, unless there is a full moon). As for HRB, I know they are not policy, but they have a lot of resources to ask, and I even asked an HRB seasonal employee about this case, and she agreed he should get it. So then, I started to really doubt myself. Thanks again for your help.

BTW, the DOT Hours of Service rules can be found at: http://www.fmcsa.dot.gov/rules-regulations/topics/hos/index.htm

Dbreck (talk|edits) said:

9 March 2012
Was just kind of curious to determine if a trucker who is gone pretty much all year, it appears maybe at home around 2 weeks a year, is still able to use the per diem. Most of the cases that I read where trucker actually has a tax home trucker his only gone like 230 days a year. This guy is like 330 at the least.

Closest thing I've found was Kennedy v. Comm, TC Memo 1987-430

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