Hello everyone, I’m a truck driver and I need some tax advice.
I live in my truck almost the entire year, about 355 days, and I do not have a physical home, apartment, or mortgage that I pay for. My company pays most of the truck-related expenses, and I only pay for my food and personal items.
My main question is about taxes at the end of the year. As a 1099 driver, should I deduct my actual meal expenses, or are meals considered personal living expenses when the truck is basically my home? After reading IRS information and other articles, I understand that some major expenses may not be deductible, but I am still unsure about meals and other small personal expenses.
I am also starting after I get paid my $1800 gross per week , am planning to send about 25% of each payment to the IRS weekly so I can stay current on my taxes. Is that a safe amount to set aside, or could that end up being too much or too little?
I would really appreciate any advice from experienced. do not have anyone nearby who can explain this clearly, so any help would mean a lot.
1099 Truck Driver Tax Question
byu/Nearby_Sprinkles4621 intax
Posted by Nearby_Sprinkles4621
3 Comments
For the tax payment part , you only need to pay quarterly not every week that would be crazy. 25% can be fine but it depends on your total business deductions and other stuff.
Excellent questions. Especially the first because it’s a tough one. And for the first one I am going to ignore the tax home because of your situation.
The other thing I want to note, is that you could be being misclassified as a contractor. But I would need more details to confirm
1) For the meal expenses, the most conservative way to handle it, is to only deduct when you’re on the road doing business. Whenever you are parked or stationed I feel any expenses lack enough business substance to deduct. If you are constantly on the road, well you’ll be able to deduct it, just keep receipts and other evidence to substantiate it.
2) Major expenses, directly related to the business are deductible 100% for the business. You need to keep your truck well maintained and insured otherwise you can participate in it. So keep that in mind if you happen to pay for upgrades or anything else your company doesn’t cover. It is different than deducting a portion of your personal residence, as you could just as easily rent an office. Plus lack of personal benefit helps.
3) 25% is fair to send. Let’s say your margin is 80% as your aren’t paying most of the expenses. So your income is 69,120, and after adjustments you would probably owe Federal around 12 to 13k if you’re filing single. So 20% would be more accurate expect. Keep in mind that doesn’t include state taxes.
But I want you to know, that you are likely being misclassified and because of it you are going to pay much more in taxes than you should.
I don’t see any scenario where normal daily meals are a business expense. The estimated tax seems reasonable to slightly high for that gross. Estimated taxes are due quarterly as you probably already know. Some states have different due dates.