The trucking industry is among the most lucrative. In addition to the high business returns, it gives operators an opportunity to travel. After buying a truck, you may opt to operate it or hire a driver. There are numerous tax benefits available for truck owner-operators.
Bookkeeping for truckers is essential in tracking your business expenses and returns. As a truck owner-operator, accounting also helps you keep track of the tax deductions you can benefit from. Equinox Business Solutions tells us more.
Meals Away From Home
You may deduct the amount you spend on meals you take to perform your duties properly while traveling on business. This is only possible if you save all the receipts from your meals. You can alternatively use the IRS’ standard allowance for meals in the transportation industry.
This only requires your log book as evidence. Only 80% of the entire meal allowance is tax-deductible annually regardless of the method you use. Lodging expenses are also deductible if you provide your receipts.
General Business Expenses
You can subtract some of the costs associated with operating your truck. These include association dues, internet service, business interest, DOT physicals and postage among others.
You can also deduct the amount you use for entertaining business associates, though personal entertainment is not tax-deductible.
Tax-deductible on-the-road expenses only cover items that are necessary and ordinary to your job. These include cargo straps, safety gear, cell phones, maps and other items. Receipts are typically required to qualify for the deduction.
Receipts are however not compulsory for purchases below$75 if you record them in your diary appropriately.
Taking deductions for expenses that are not tax-deductible might trigger IRS audits and inquiries. It is hence prudent to get a professional offering tax services for the trucking sector to help calculate your deductions. This will ensure you maximize your tax deductions and stay out of trouble with the IRS.