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When you operate your own truck-driving business, regardless of whether
you are a sole proprietor or employ thousands of drivers, the IRS allows you to claim deductions for all operating expenses. There is no exhaustive list of deductible expenses. Instead, the IRS evaluates whether each expense is ordinary and necessary for your business. However, truck drivers commonly claim a number of expenses on their tax returns.[/box]
[box type=”shadow”]Truck Driver Salaries
If you ever need help with your trucking business and hire an employee or independent contractor, the IRS allows you to deduct the entire cost of his services. The IRS will not scrutinize your decision to pay one driver more than you pay another; however, the amount of compensation you provide employees and contractors must be reasonable in light of their skill sets. For example, paying a contractor who possesses a commercial truck-driving license and 20 years of experience $500 per day to drive one of your trucks from New York to California may be high, but it’s not unreasonable. However, if you pay the contractor $5,000 per day instead, it’s likely the IRS will question whether the expense includes payment for something other than compensation for his services.[/box]
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Truck-Related Expenses
Whether you operate one truck or a large fleet, the expenses related to acquiring and operating the trucks will likely be substantial. As long as you use the trucks solely for business, the IRS allows you to deduct all costs of acquiring, maintaining and operating them. This includes money for gasoline, oil, repairs and maintenance, parking fees, tolls, insurance and any lease payments you make on the trucks. However, if you purchase rather than lease the truck, you can claim depreciation deductions for part of the purchase price each year until you recover the entire cost.[/box]
[box type=”shadow”]Hotels and Food
If your business ever requires you or your employees to take long-distance road trips, you can deduct the cost of lodging and 50 percent of your food purchases if it’s necessary for you to stop for rest along the way. For example, if you drive your truck on the New York to California route, you will need to stop for rest a few times before returning home. But if you move a customer’s furniture from one home to another in the same neighborhood, regardless of how many hours you drive the truck during the day, it’s not necessary for you to stay in a hotel overnight to rest.[/box]
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Advertising Expenses
Most self-employed truck drivers will need to advertise their services at one point or another to grow their business. Any expense you incur for ads in local newspapers, on the radio or even to purchase television airtime is fully deductible as a business expense on your tax return.[/box]