Taxes for people who cook out of a truck
You run a kitchen that moves. Propane, permits, commissary rent, and a different lot every weekend. We know where all of it goes on the return.
Nothing is due today. Personal returns start at $250.
A food truck is a vehicle and a commercial kitchen at the same time, and the return has to treat it as both. Your food and packaging are cost of goods sold rather than supplies, and much of your paperwork lives inside a POS app and a stack of city permits. We prepare the return with all of that in mind, and we tell you exactly what we need before the season gets loud.
What food trucks can usually deduct
Ordinary and necessary costs of your work. Rules and dollar limits change year to year, so we confirm every one of these against the current year when we prepare your return.
The truck or trailer
The vehicle, the kitchen built inside it, and what you spend keeping both alive: tires, brakes, transmission work, generator service, and mechanical inspections. The purchase itself is recovered through depreciation or first year expensing, not written off in one line by default.
A truck permanently built out as a kitchen is often treated as work equipment rather than a passenger car, so the passenger car depreciation limits may not apply. That turns on the vehicle's weight and how it is built, so we look at the actual truck. For the truck itself, expenses are usually tracked by actual cost rather than a per mile rate, and we confirm which method it is eligible for before we file.
Propane, fuel, and generator gas
Propane for the flat top and fryers, gas or diesel for the generator, and fuel to move the truck are all deductible. On the books they are three different costs, not one.
Cooking fuel is a kitchen cost, not a vehicle cost. Keep the propane and generator receipts separate from driving fuel so nothing gets buried in the wrong category and lost.
Commissary rent and dump fees
The commissary kitchen your health department requires, overnight parking or yard storage for the truck, potable water fills, grease and gray water disposal, and dumpster fees.
Commissary rent is deductible. The drive from your house to the commissary each morning is generally commuting, and commuting is not deductible.
Permits, licenses, and inspections
Mobile food vendor permits, health department plan review and inspections, fire marshal visits, hood and suppression system certification, extinguisher service, food manager certification, and the separate permit every city or county wants before you park.
Fines and penalties paid to a government for breaking a law are not deductible. Parking tickets, health code penalties, and late filing penalties come out of your pocket after tax, no matter how routine they feel.
Event, festival, and lot fees
Booth fees, market day rates, the percentage of sales a venue takes, brewery or parking lot rent for your regular spot, and deposits you forfeit when an event is called off.
If a venue keeps a cut of your sales, your income is still the full amount the customer paid. Report the gross and deduct the venue's cut. Do not report only what you walked away with.
Food, drinks, and packaging
Proteins, produce, dry goods, oil, sodas, foil, clamshells, cups, napkins, and branded sleeves. These are cost of goods sold, which is figured from what you bought and what was left over, not simply from what you spent.
Whatever is still in the walk-in and on the shelves at year end is inventory, not an expense yet, so it has to be counted. Food you and your family ate off the truck comes out of cost of goods sold too.
Kitchen equipment and build out
Flat top, fryer, refrigeration, freezer, prep tables, hood, generator, water pump and tanks, propane cages, POS tablets and printers, and the fabrication labor to install all of it.
Fixing a fryer is generally a repair you deduct now. Replacing the whole cooking line is generally an improvement that gets depreciated. How much of a new purchase can be written off in the first year depends on which method applies, and one of those methods is limited by your business income for the year.
Card processing and app fees
Square, Toast, or Clover subscriptions and per swipe fees, card readers and hardware, online ordering commissions, and the cut delivery apps take on catering and curbside orders.
Your deposits are already net of these fees. Form 1099-K reports the gross, so if you book only the deposits, the IRS sees more sales than you reported and you never claimed the fees that explain the gap.
Crew pay and payroll taxes
Wages for your window and line crew, the employer share of payroll taxes, workers compensation premiums, and payroll service fees. If you have tipped employees, there is a federal credit that can apply to part of the employer Social Security and Medicare tax paid on tips your crew reports. It carries its own conditions, so ask us whether your setup qualifies.
Worker classification turns on how much control you have over the work. Someone who works your scheduled shifts, on your truck, with your equipment, under your direction usually looks like an employee rather than a contractor. Cash handed out at the end of a shift and called contract labor is hard to defend if the classification is ever examined.
Insurance on truck and product
Commercial auto for a vehicle that is also a kitchen, general and product liability, workers compensation, and coverage on the equipment and inventory inside. The certificates of insurance events demand come out of these same policies.
Personal auto policies generally exclude business use of this kind. If the truck is still on personal coverage, check with your agent, because that is a claim problem before it is ever a tax problem.
Uniforms and safety gear
Chef coats, cut gloves, oven mitts, non slip kitchen shoes, hairnets, aprons, and the first aid kit on board.
The test is whether the clothing is required for your work and is not suitable for everyday wear. Plain jeans and blank black tees do not qualify even if you only wear them on the truck. Adding your logo helps make the case, but it does not by itself turn ordinary street clothes into a deduction.
Wrap, signage, and marketing
The vinyl wrap and the design behind it, menu boards, A frames, canopy and table covers, social ads, your website and domain, printed menus, and the photographer who shot the food.
Advertising is normally deducted in the year you pay for it, and a wrap usually falls there. A large wrap or build out meant to last for years can instead have to be capitalized with the truck, so keep the invoice and let us look at it.
A single truck owned by one person is normally reported on Schedule C, and that can stay the right home for a long time. It usually stops being the right home when profit is steady and strong enough to pay yourself reasonable compensation and still leave a distribution, or when you add a second truck, a partner, or a fixed location. That call should be made with your actual numbers rather than a rule of thumb.
What to bring us
You do not need all of it to start. Send what you have and your checklist shows what is still open.
- Your year end POS sales report showing gross sales, tips, discounts, and refunds, not just the deposit totals
- Every Form 1099-K from your card processor and from any delivery or online ordering app
- Bank and credit card statements for every account the truck touched, including any personal card you paid business costs with
- Purchase or loan paperwork for the truck or trailer, plus the year end interest statement
- Invoices for the build out and for any equipment added during the year, with the date each item went into service
- Your commissary agreement and rent receipts, along with invoices for event, festival, and lot fees
- Permit, license, and inspection receipts for every city and county you worked in
- Payroll reports, Forms W-2, tips reported by your crew, and any Form 1099-NEC you issued
- A count of food, drinks, and packaging still on hand at the end of the year, with what you paid for it
- Mileage records for any personal vehicle used on supply runs, plus fuel and propane receipts
What trips people up
Reporting whatever landed in the bank
Start from gross sales in your POS, then deduct processor fees, app commissions, and refunds as expenses. Deposits are already net, so using them understates your sales and your costs at the same time, and it will not match your Form 1099-K.
Leaving cash sales off the books
Ring every sale through the POS, cash included, and keep the daily count with the deposit slip. Cash is income whether it is recorded or not, and a gap between your sales records and your deposits is one of the first things an examiner asks you to explain.
Booking food cost as supplies
Food, drinks, and packaging you resell are cost of goods sold, and what is still on the shelf at year end is inventory. Do a count at the end of the year and give us the number with what you paid for it.
Paying crew out of the register
If people work your scheduled shifts on your truck under your direction, run payroll. Talk to us before the year closes rather than after, because correcting a year of unrecorded wages means amended payroll filings and exposure to penalties and interest.
Waiting until filing to think about the bill
Schedule C profit carries income tax and self employment tax figured on Schedule SE, and nothing is withheld along the way. Set money aside from each event and make estimated tax payments during the year so the number at filing is one you already knew about.
What it costs
Our published list, the same one everyone sees. Prices marked "from" are starting points, and your exact number is confirmed in writing before any work begins.
$0 is due today. You pay when you sign, or you can have your fee come out of your refund, so it can be $0 out of pocket.
Questions we get from your trade
Can I write off the whole truck the year I buy it?+
Sometimes. A truck built out as a kitchen is often treated as business equipment rather than a passenger car, so the passenger car depreciation limits may not apply, though that depends on the vehicle. How much lands in the first year depends on the expensing and bonus depreciation rules in effect for that year, on when the truck was placed in service, and, for one of those methods, on your business income. We run it both ways and show you the difference before we file.
Is the drive from my house to my spot deductible?+
Running the truck is a business cost, but travel between home and a regular work location, often the commissary, is commuting and is not deductible. Once the day has started, runs between commissary, event, and supply house are business travel. A qualifying home office can change that analysis, but the space has to be used regularly and only for the business and has to meet the rules for a principal place of business, so the kitchen table does not count. Tell us how your days actually run and we will apply the rules to your facts.
I ate off my own truck all season. Is that a deduction?+
Your own food is personal, and its cost should be pulled out of cost of goods sold rather than deducted. Meals you provide to your crew during a shift fall under separate employee meal rules, and a meal with a catering client can be a business meal subject to a partial deduction limit. Keep those three buckets apart in your notes and we will sort them at filing.
My Form 1099-K is much bigger than what I deposited. Is it wrong?+
Usually not. That form reports gross card sales before processing fees, app commissions, chargebacks, and refunds, while your bank only ever saw the net. We report the gross and deduct the fees, which is why we start from your POS report rather than your bank statement.
Do I need an LLC or an S corp?+
An LLC is a liability question, and for a single owner it does not by itself change your federal income taxes. An S corp election is a tax question, and it only starts to make sense when your profit is steady and large enough to cover reasonable compensation to you as an employee and still leave something over, because it brings payroll, a separate return, and real cost with it. We look at your numbers first and tell you plainly if it is not worth it yet.
Do I have to charge sales tax, and does it count as my income?+
Prepared food is taxable in many places, and the rules vary by state and sometimes by city, so where you park matters. Where you are collecting the tax as an agent for the state, that money is not your revenue and should not sit in your books as sales. We make sure your return and your sales tax filings tell the same story.
Let us take the tax part off your plate.
Tell us what you need and see your price. A real person on your team replies within one business day.