Tax help for owner-operators and lease drivers
You run a business out of a cab. Your return should look like it. We prepare taxes for drivers in English and Spanish, from Coral Gables, anywhere in the country.
Nothing is due today. Personal returns start at $250.
Nobody withholds tax from a settlement check. That one fact changes everything about your return, because the money you owe piles up quietly all year while you are running loads. On top of that, the write-offs that carry the most weight are the ones that get handled wrong most often: the truck itself, the nights you slept away from home, and the chargebacks your carrier already took out before paying you. We prepare returns for drivers and we read settlement statements for a living.
What truck drivers 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.
Per diem for nights away from home
When your work takes you far enough from home that you need sleep or rest before driving back, you can claim a meals and incidental expenses allowance for each of those days instead of saving every food receipt. The IRS publishes a special per diem rate for workers subject to Department of Transportation hours of service rules, and only a portion of that amount is deductible. Both the rate and the limit are set by the IRS and change from year to year, so we apply the figures in effect for the year we are filing.
This is only for trips where you were away long enough to need rest before heading back. A long day that ends at your own bed does not count, no matter how many hours you drove.
Truck payment and depreciation
If you own the tractor, you do not deduct the monthly payment. You deduct depreciation on the truck plus the interest portion of the loan. A qualifying truck placed in service during the year may be eligible for accelerated first year write-offs, which carry their own conditions and limits and are not automatic.
Only the interest part of the note is an expense. The principal part is not a deduction, it is you paying down what you borrowed.
Lease and lease-purchase payments
If you lease the truck from the carrier or a leasing company, the payments generally come off as a lease expense. A lease-purchase agreement is a different animal and may be treated as a purchase for tax purposes, which changes how the truck is written off.
Bring the actual lease agreement, not just the settlement statements. The wording of the contract, including the buyout terms, decides whether it is a lease or a purchase, and the two get very different tax treatment.
Fuel, DEF and fuel taxes
Diesel, diesel exhaust fluid and reefer fuel are deductible when you pay for them. IFTA fuel tax payments and the heavy highway vehicle use tax you pay for the tractor are business expenses too.
If your carrier advances fuel and deducts it from your settlement, do not deduct it twice. Match the fuel expense against how the settlement reports your gross pay.
Repairs, tires and maintenance
Oil changes, tires, brakes, belts, hoses, DPF cleaning, roadside service calls and shop labor all come off. So do the parts you buy yourself and install in the yard.
A repair that keeps the truck running is an expense. A rebuild or an engine replacement that extends the life of the truck may have to be capitalized and depreciated instead of deducted all at once.
Trucking insurance
Bobtail and non-trucking liability, physical damage on the tractor and trailer, and cargo insurance are business insurance and come off as an expense. So does the portion your carrier charges back to you on the settlement, as long as that charge was not already taken out before your income was reported.
Occupational accident coverage is a different case, because it pays you for your own injury or lost income, and that kind of policy is not always treated as a deductible business expense. Bring the policy and let us read it rather than assuming. Your personal auto policy is not business insurance, and personal health premiums are handled elsewhere on the return.
Licensing, permits and compliance
CDL renewal, medical card exams, DOT physicals, drug and alcohol testing program fees, IRP apportioned plates, UCR registration, state permits and scale fees all belong here.
The cost of getting your first CDL is generally not deductible, because it qualifies you for a new trade. Renewing the CDL you already hold is deductible, and so is added training or an endorsement that builds on the license you already have.
ELD, dispatch and phone
Your electronic logging device subscription, load board memberships, dispatch service fees, trucking software, GPS with truck routing, and the business portion of your cell phone and data plan come off.
If your phone is also your personal phone, only the business share is deductible. Pick a reasonable percentage you can explain and stay consistent with it.
Truck equipment and supplies
Chains, binders, straps, tarps, load bars, bungees, gloves, safety vest, hard hat, flashlights, tools, air hoses, glad hands, fire extinguisher, triangles, coolant, wiper blades and windshield washer fluid are all ordinary purchases for this work.
Regular jeans, boots and jackets are not deductible even if you only wear them to work. To qualify, clothing has to be required for the job and not suitable for ordinary wear off the job. Protective gear usually clears that bar. A company logo on a shirt you could wear anywhere usually does not.
Sleeper berth and on-the-road items
The 12 volt fridge, inverter, APU, bunk heater, CB, cab mattress, bedding for the sleeper, and laundry while you are out on the road are business costs for a driver who lives in the truck for days at a time.
Two limits here. Items that mostly serve your comfort at home do not qualify just because they ride in the truck. And a larger piece of equipment such as an APU may have to be depreciated over time rather than written off the year you buy it.
Tolls, parking, scales and showers
Tolls, truck parking, overnight lot fees, scale fees, lumper fees, and showers you buy while away from home overnight are deductible. Keep the settlement detail for lumper reimbursements so income and expense line up.
If your carrier reimburses lumpers and includes the reimbursement in your gross, deduct the expense. If the reimbursement was never included in your gross, do not deduct it.
Retirement and self-employed health insurance
As a self-employed driver you can set up a retirement plan built for one-person businesses and deduct your contributions, within the annual limits set by law for that plan type. Premiums you pay for medical, dental and qualifying long term care coverage for yourself and your family may be deductible without itemizing.
The health insurance deduction is capped by the net profit of the business it relates to, and it is not allowed for any month you were eligible to take part in a subsidized health plan through your own employer or your spouse's.
A driver operating as a sole proprietor or a single-member LLC reports the business on Schedule C, and that is the right place to be until the numbers say otherwise. Once profit is consistently high enough that a reasonable wage plus payroll costs still leaves self-employment tax savings behind, an S-corp election is worth pricing out. We run the numbers on your actual profit first, because the election adds a business return and payroll obligations that only pay for themselves above a certain point, and that point is different for every driver.
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.
- Any 1099-NEC or 1099-MISC you received from carriers, brokers or factoring companies, plus your year end settlement summaries. Some carriers do not issue a 1099 for freight, and the income is reportable either way
- Weekly or monthly settlement statements showing gross pay and every chargeback the carrier took out
- Your truck purchase paperwork or the full lease or lease-purchase agreement, including the buyout terms
- Loan statements for the tractor and trailer showing how much of the year was interest
- Fuel card statements and IFTA filings, plus receipts for fuel you paid for outside the card
- Repair and maintenance invoices, tire receipts and any major component work done during the year
- A record of the nights you were away from home, which your ELD logs or trip sheets can usually produce
- Insurance policies and premium notices for bobtail, physical damage, cargo and occupational accident
- Licensing and compliance receipts: plates, permits, UCR, heavy vehicle use tax, DOT physical, drug testing program
- Your entity paperwork if you have an LLC or S-corp, your prior year return, and any estimated tax payments you made
What trips people up
Deducting the whole truck payment every month
Split the payment. The interest is an expense and the principal is not. The truck itself is written off through depreciation on its own schedule, which is separate from what you send the lender each month.
Saving food receipts instead of tracking nights away
Track the dates you were away overnight. Drivers subject to Department of Transportation hours of service rules can use the special per diem allowance for those days, and the day count is the record that deduction rests on. If you would rather deduct actual meal costs, keep the receipts, but you cannot do both for the same travel.
Deducting expenses the carrier already took off your settlement
Read the settlement carefully. If the carrier deducted insurance, fuel or plates before paying you, find out whether your 1099 reports gross or net. Deducting something that was never in your income counts it twice.
Filing an S-corp election and then not running payroll
If your LLC elected S-corp treatment, you owe yourself a reasonable wage through actual payroll, with real withholding and real filings. Taking distributions with no W-2 is a known compliance problem and the IRS can recharacterize those distributions as wages. Talk it through before you elect, not after.
Not paying quarterly estimates
Nobody withholds tax from a settlement check. Self-employment tax lands on top of income tax, and the whole bill shows up at filing time, potentially with an underpayment penalty on top. Set the estimates up at the start of the year so the money is already gone before you feel it.
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
I got a 1099 from my carrier. Am I an employee or a business?+
If the carrier issued a 1099-NEC, they are treating you as an independent contractor. As a sole proprietor or single-member LLC, your income and expenses go on Schedule C and your self-employment tax is figured on Schedule SE. If you operate through a partnership or an S-corp, the business files its own return instead. If you also had a W-2 job during the year, that goes on the same personal return.
Should I have an LLC or an S-corp?+
Forming an LLC by itself does not change how your income is taxed. It is a legal shield. An S-corp election can reduce self-employment tax once profit is high enough to justify running payroll, but it adds a business return, payroll filings and a real wage requirement. It is a numbers question, and we run it on your actual profit before recommending either way.
Can I take per diem and also deduct my meal receipts?+
No. For the same travel it is one or the other, and you apply the same method consistently. Either you deduct actual meal costs with records behind them, or you use the special per diem allowance for the days you were away. Either way, the record that carries the deduction is a reliable log of which nights you were away from home.
I use a spare bedroom for dispatch and paperwork. Is that a home office?+
Possibly, but the space has to be used regularly and exclusively for the business. If the family uses it too, it does not qualify. There are also rules about the space being where you do the administrative side of the business, which takes a closer look when the truck is where you actually do the work. We will walk through it with you rather than assume it either way.
I did not keep good records this year. Is it too late?+
Bring what you have. Settlement statements, fuel card history, bank and credit card statements and your ELD data reconstruct a lot of a year. We would rather build it from real documents than guess at numbers on a return we sign.
Do I file a return in every state I drive through?+
Usually not, but it is not automatic. There is a federal rule that keeps many interstate drivers from being taxed by every state they roll through, and it is written around employees of motor carriers, so it does not cover every self-employed owner-operator the same way. Where you actually file depends on where you live, how you are paid, whether you operate through an entity, and each state's own rules. Tell us your home state and your lanes and we will tell you what you have to file.
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.