ILLMAS Posted April 29, 2014 Report Share Posted April 29, 2014 I have no experience with OTR truckers, and I've been holding off on working a new client and I wanted to see if forum members with experience can assist me through my journey. Here is brief scenario and then I will post my questions. TP was an employee for the first three months in 2013, bought a truck and became a subcontractor for the rest of the year. He drove approx. 150K miles and earned 182K, the company deducted operating expenses like fuel, lodging, maintenance, tolls etc... After all these deductions he only earned about 70K, then from that 70K he had to pay insurance, part of meals, telephone, truck washed, truck note (interest portion), which was another 15K leaving him with 55K profit/take home. Now here are my questions: 1. Since he was paid by miles driven, does this industry qualify for the mileage deduction, might be a dumb question but I have to ask. 2. When you capitalize the truck, do you enter the expenses on the auto expense tab? 3. How does the meal per diem work for this industry? 4. Anything else I should be looking for or asking? Thanks MAS Quote Link to comment Share on other sites More sharing options...
Elrod Posted April 29, 2014 Report Share Posted April 29, 2014 Mas, It's been many years since I had an OTR trucker as a client. I recall that it involved several accounting details. Although, here are some sources that you may find useful. http://www.bigtrucksbigbucks.com/wp-content/uploads/2014/01/OTRDeductibleExpensesWS1.pdf http://www.bigtrucksbigbucks.com/wp-content/uploads/2014/01/OTRDeductionsExplan.pdf http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Trucking-Tax-Center Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted April 29, 2014 Report Share Posted April 29, 2014 Now here are my questions: 1. Since he was paid by miles driven, does this industry qualify for the mileage deduction, might be a dumb question but I have to ask. 2. When you capitalize the truck, do you enter the expenses on the auto expense tab? 3. How does the meal per diem work for this industry? 4. Anything else I should be looking for or asking? Thanks MAS Marco, you do not use mileage on a heavy truck, you must use actual expenses. And you want to, anyway, as standard is based on auto averages. Trucks operating expenses are much higher. Elrod gave you some good links. After you read those, if you want, come back with any questions. Quote Link to comment Share on other sites More sharing options...
pikester1967 Posted April 29, 2014 Report Share Posted April 29, 2014 Suggestions for Deductible Items Air freshener Armorall Alarm clocks Antennas Atlas Batteries Ben Gay Boots (steel toed or rubber work boots) Boot repair Briefcase Brooms and dust pans Buffer (for shining truck) Bunk heaters/fans Bus fare (home to job) Cab curtains Calculator Camera CB radio and repairs Check cashing fees Cigarette plug-ins Cleaning supplies Clipboard Coffee maker Comcheck fees Cooler Cooler motor Copies Crowbar Circuit tester Disinfectant Truck/trailer storage De-Icer Duct tape Drivers License (CDL) Electrical tape Ether Fax Flashlight Floormat Fly swatter Film developing Film for damage claims First aid supplies Fumigate trailer Gloves Hammer Hand cleaner Hangers Hard hat Ice Jack strap Lap desk Laundry bag Laundry detergent Liquid paper Load locks Lock Log book covers Magnifying glass Maps Map lamp Metal shelves Money order charges Paper clips Paper/notebook Paper towels Parking Pencils/pens Phone Physical (DOT) Pillow Power booster Power cord Rain gear Razors Receipt book Refrigerator Safety glasses Saucepan Screwdriver Seat covers Sewing kit Shaving kit Sheets Shift grip Showers Sleeping fan Sleeping bags Sunglasses Stapler/staples Thermal underwear Thermos Tissues Tie-downs Toiletries Towels Trash bags Truck cables Toaster Tolls Towing Travel bag Truck wash Tupperware Truck magazines Uniforms/alterations Vacuum (portable) Visine Watch WD-40 Window screen Quote Link to comment Share on other sites More sharing options...
ILLMAS Posted April 29, 2014 Author Report Share Posted April 29, 2014 Suggestions for Deductible Items Air freshener Armorall Alarm clocks Antennas Atlas Batteries Ben Gay Boots (steel toed or rubber work boots) Boot repair Briefcase Brooms and dust pans Buffer (for shining truck) Bunk heaters/fans Bus fare (home to job) Cab curtains Calculator Camera CB radio and repairs Check cashing fees Cigarette plug-ins Cleaning supplies Clipboard Coffee maker Comcheck fees Cooler Cooler motor Copies Crowbar Circuit tester Disinfectant Truck/trailer storage De-Icer Duct tape Drivers License (CDL) Electrical tape Ether Fax Flashlight Floormat Fly swatter Film developing Film for damage claims First aid supplies Fumigate trailer Gloves Hammer Hand cleaner Hangers Hard hat Ice Jack strap Lap desk Laundry bag Laundry detergent Liquid paper Load locks Lock Log book covers Magnifying glass Maps Map lamp Metal shelves Money order charges Paper clips Paper/notebook Paper towels Parking Pencils/pens Phone Physical (DOT) Pillow Power booster Power cord Rain gear Razors Receipt book Refrigerator Safety glasses Saucepan Screwdriver Seat covers Sewing kit Shaving kit Sheets Shift grip Showers Sleeping fan Sleeping bags Sunglasses Stapler/staples Thermal underwear Thermos Tissues Tie-downs Toiletries Towels Trash bags Truck cables Toaster Tolls Towing Travel bag Truck wash Tupperware Truck magazines Uniforms/alterations Vacuum (portable) Visine Watch WD-40 Window screen LOL thanks can I send you some work to keep you busy JK 2 Quote Link to comment Share on other sites More sharing options...
pikester1967 Posted April 29, 2014 Report Share Posted April 29, 2014 LOL thanks can I send you some work to keep you busy JK Had many OTR's at my practice in AR years ago. YW Quote Link to comment Share on other sites More sharing options...
mcb39 Posted April 29, 2014 Report Share Posted April 29, 2014 I have no experience with OTR truckers, and I've been holding off on working a new client and I wanted to see if forum members with experience can assist me through my journey. Here is brief scenario and then I will post my questions. TP was an employee for the first three months in 2013, bought a truck and became a subcontractor for the rest of the year. He drove approx. 150K miles and earned 182K, the company deducted operating expenses like fuel, lodging, maintenance, tolls etc... After all these deductions he only earned about 70K, then from that 70K he had to pay insurance, part of meals, telephone, truck washed, truck note (interest portion), which was another 15K leaving him with 55K profit/take home. Now here are my questions: 1. Since he was paid by miles driven, does this industry qualify for the mileage deduction, might be a dumb question but I have to ask. 2. When you capitalize the truck, do you enter the expenses on the auto expense tab? 3. How does the meal per diem work for this industry? 4. Anything else I should be looking for or asking? Thanks MAS I just finished a return for a OTR trucker last night so will try to help you out. For the three months he was an employee, he deducts his expenses on the 2106 which then takes the deduction to the Sch A. When he becomes a subcontractor with his own truck, all of his expenses go onto the Sch C. If he is a DOT driver carrying products or people interstate, his meal per diem is $59 for overnights. The truck repairs, and any other expenses will now be entered on the Sch C. Quote Link to comment Share on other sites More sharing options...
mcb39 Posted April 29, 2014 Report Share Posted April 29, 2014 The long list fro Pikester is absolute; except you have to remember that the $59 per diem is for "meals and incidentals". Any more questions, keep asking. Some of us have had OTR for years. It is a hard life and even harder to show a profit with the high cost of fuel these days. Then, there are lumper fees and reefer fees and an off-road fuel credit for reefer fuel. Good Luck. 1 Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted April 30, 2014 Report Share Posted April 30, 2014 And in case you don't know, a 'lumper fee' is the amount paid for the labor to unload a container. The people that do this work are called lumpers. And a reefer is a refrigerated truck, not something you smoke. and a "reefer mile" (which refers to the period of time that the engine for the refrigerator unit kicks in in order to keep the temperature at 41 degrees) is a separate charge you may come across. 3 Quote Link to comment Share on other sites More sharing options...
mcb39 Posted May 1, 2014 Report Share Posted May 1, 2014 And in case you don't know, a 'lumper fee' is the amount paid for the labor to unload a container. The people that do this work are called lumpers. And a reefer is a refrigerated truck, not something you smoke. and a "reefer mile" (which refers to the period of time that the engine for the refrigerator unit kicks in in order to keep the temperature at 41 degrees) is a separate charge you may come across. Funny, I had to ask those two questions. Most of my drivers keep the reefer fuel separate in order to claim the off-road fuel tax credit. The one I finished the other night actually had almost $800 in fuel tax credit alone. Thanks for explaining those two distinctive terms to the board. You did a far better job of it than I could have. I have had truckers for all of my professional career; my son having been one for over 20 years. Some are employees and some are SE Tractor owners. I remember years ago, running around trying to find a 2106 for to record employee road expenses for all of my Greenhouse drivers. Things have sure changed. 1 Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted May 2, 2014 Report Share Posted May 2, 2014 Yes, I had a lot of truckers, and you have to know the lingo, for sure. Quote Link to comment Share on other sites More sharing options...
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