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Anne
Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2355
Experience:  Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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What is the max amount of Per Diem for an OTR truck driver?

Customer Question

What is the max amount of perdiem that an ORT truck driver can claim for meals etc., and if the driver is also a mentor with a student on board?
Also can perdiem be claimed up to a certain amount for the year without showing receipts for each meal?

Submitted: 4 years ago.
Category: Tax
Expert:  Lev replied 4 years ago.

Hi, and welcome to JustAnswer!

The OTR truck diver may use a special rate for transportation workers. You can use a special standard meal allowance if you work in the transportation industry. You are in the transportation industry if you work:

* Directly involves moving people or goods by airplane, barge, bus, ship, train, or truck, and
* Regularly requires you to travel away from home and, during any single trip, usually involves travel to areas eligible for different standard meal allowance rates.

If this applies to you, you can claim a standard allowance of $59 a day ($65 for travel outside the continental United States).

Using the special rate for transportation workers eliminates the need for you to determine the standard meal allowance for every area you stop for sleep or rest. If you choose to use the special rate for any trip, you must use the special rate (and not use the regular standard meal allowance rates) for all trips you take that year.

There is no special deduction for a student on board - but a student may be able to claim his/her own deductions.

In addition -

Generally, you can deduct only 50% of your business-related meal and entertainment expenses. (If you are subject to the Department of Transportation's "hours of service" limits, you can deduct 80% of your business-related meal and entertainment expenses.)

So, the OTR truck driver may deduct 80% of business-related meal - either if he/she claims acutal expense or using per diem.

See for reference -

http://www.irs.gov/pub/irs-pdf/p463.pdf

Let me know if you need any help.

Customer: replied 4 years ago.

Please answer the last part of my question -
do I need to have proof of expenses from day one and can I deduct the student’s mean if I pay for it.

Expert:  Lev replied 4 years ago.

"Do i need to have proof of expenses from day one?"

If you are using per diem – no need to proof actual expenses – but you still might be asked to prove the fact of travels – so if there are some receipts from different cities – they may be used to prove the fact of your travel – but you do not need these receipts to prove the amount you spent as long as you are using per diem rate.

"And can i deduct the student's meal if i pay for it?"

You may not deduct the student's meal. Whatever you paid for the student - you need to report as his compensation - and then - you will deduct that payments.

The student may be able to claim his/her own deductions.

Customer: replied 4 years ago.

Please be more specific as to why I can't deduct my student's meal if I paid for it. What do you mean that I need to report as his compensation – and then I will deduct those payments, deduct them from what or where and for what amount or what percentage? How, can the student deduct what the student did not pay for?

Expert:  Lev replied 4 years ago.

"Please be more specific as to why I can't deduct my student's meal if I paid for it?"

You may not deduct expenses you paid for someone unless that person is your employee. If you hire a student and pay him wages - the student will be your employee - then you may set up an accountable reimbursement plan and then deduct your employee's business expenses.

"What do you mean that I need to report as his compensation - and then - I will deduct those payments?"

If you paid for student's meal because the student provided services for you - that payment is treated as a compensation for these services - and because that is a compensation - it should be included in his taxable income.

"Deduct them from what or where and for what amount or what percentage?"

For you to deduct these expenses you will report them on form 2106 if you are an employee or on schedule C if you are self-employed contractor.

You will report the actual amount you spent.

"How can the student deduct what the student did not pay for?"

If you pay for the student and report that amount as his income - it is considered as paid by him.

Customer: replied 4 years ago.

Okay, then is it safe to say that if the standard meal allowance is $59 and it is considered 50% of your business -related meal and entertainment and if you are subject to the Department Of Transportation's " hour of service" limits then I can deduct 80% of business-related meals or $76.70 using per diem?

Expert:  Lev replied 4 years ago.

Yes - for 2011 - as the OTR truck driver you may use a special rate for transportation workers $59. Also – because the OTR truck driver may deduct 80% of that amount – this means – your actual deduction for each day you are on the road will be $59 * 80% = $47.20. You do not need to prove these expenses – but still need to prove that you were traveling your of your home.

Customer: replied 4 years ago.

If $59 is considered to be 50% of your related meal expenses? Then how can $47.20 be considered to be 80%? Should it not be $76.70?

Expert:  Anne replied 4 years ago.

Different expert here. I think I understand where you are coming from. If my thinking is correct, you are under the impression that the $59/day that the above expert quoted you is ALREADY only 50%, of the meal allowance, and that is not true.

100% of the meal allowance, according to the IRS for 2011 is $59/ day. Those people not subject to DOT may only claim 50% of the $59, or $29.50/day.

Since you fall under the DOT regs, you may claim 80% of the $59/day which is the $47.20 the above expert quoted you.

My opinion is that you should accept the above expert's answer.

Customer: replied 4 years ago.

Please read where the previous expert wrote on the 4th paragraph. If this applies to you, you can claim a standard meal allowance of %59 a day ($65 for travel outside the continental United States)

Then he wrote –

In additional – Generally you can deduct only 50% of your business – related meal and entertainment expenses.

Here I understand that your standard meal allowance of $59 is 50% of your deductions and $118 is 100% and you can go on to say that $59 is 100% and that those people are not subject to may only claim 50% of the $59 or $29.50 a day and I fall under the dot regs and can claim 80% or $47.50.

What does one have to do to be able to deduct the total amount of $59 and was this the same for the year of 2009?

Expert:  Anne replied 4 years ago.

This posting actually helped a lot, since it let me know what you are confused about. Hopefully, I don't confuse you more - but this can be a confusing subject at first. I know it took me a little while to wrap my brain around it when I was a new tax pro 25 years ago.

There are 2 ways to figure per diems. One is called the High/Low method This method is used by truckers that regularly travel to destinations that are eligible for the higher per diem. This method also requires that more intricate records are kept, proving not only that you were in those locations, but for 2011, the rates went up in October, so you would have to also have documentation of when you went to these locations. Please see per diem rates starting on page 4 below:

Publication 1542 (Rev. October 2011)



NOTE: AT THE TOP OF EACH TABLE IT READS:Localities Eligible for $233 ($65 M&IE) Per Diem Amount Under the High-Low Substantiation Method
(Effective October 1, 2010 – September 30, 2011)1
,2 Note: The standard (“low”) rate of $160 ($108 for lodging and $52 for M&IE) applies to all locations within the continental United States
(CONUS) not specifically listed below or encompassed by the boundary definition of a listed point.


ALL PER DIEM RATES ARE ALWAYS LISTED AT 100%. That is because most people can only take 50% of the per diem. Only those people that fall into the category of "Special Rates for Transportation Services" (which as a trucker, you would) are allowed to claim 80% of the per diem.

It then goes on to give you some different rates for some cities. Although they list per diems for lodging, this is solely for the employer when he is figuring out how much he can count as reimbursement for hotels. You, as a taxpayer may NEVER include the per diem for lodging. If your employer does not reimburse you for lodging, then you can deduct the actual cost of lodging with your receipt.

If this confuses you, please keep reading.

What the previous Expert gave you was an alternate method. One where you don't need to keep track of where you've been, or, if you never go to the cities listed with the higher per diem amounts. You will notice if you use the High/Low rates, that any location not listed on the chart is $52 a day. However, if using that method isn't advantageous for you because you don't go to those locations, or you don't have the proper documentation, then there is an alternative that only truckers can use. That rate is $59/day. Again, this listing is 100%, so you would be eligible to claim 80% of the $59 which is $47.20.

Please see below:

Per-Diem Rate for Truckers - Owner-Operator Independent Drivers ...

If the link doesn't work, here's the web address you can copy and paste into your web browser:

http://www.ooida.com/Education%26BusinessTools/Resources/Per_diem_rate.shtml

This last link has the per diems listed as far back as 2004. The rate for 2010 was the same, but for 2009 it was $52/day

I hope this helps, and if you have any other questions, please let me know.

Anne, Master Tax Preparer
Category: Tax
Satisfied Customers: 2355
Experience: Enrolled Agent with 25 Years Experience specializing Individual and Small Businesses
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