Truck drivers fall into a variety of different categories when it comes to calculating eligible tax deductions. Much depends on whether the truck driver is self-employed or works for someone else and whether a vehicle is owned in an individual’s name or a company name. Travel that takes place in the course of performing work-related duties generally has the greatest number of eligible deductions, while travel in a personal truck to and from a work site has the least.
Self-Employed Truck Driver
A self-employed truck driver who contracts his services to others is typically entitled to a variety of tax deductions. Costs associated with ownership and maintenance of the truck can be deducted or depreciated, including lease or loan fees, general maintenance and upkeep and insurance. A truck driver can also deduct the cost of gas, either by taking a standard mileage deduction or saving and tallying gas receipts and counting actual expenses.
Company-Employed Truck Driver
A truck driver employed by a company and driving a company-owned truck typically has no eligible deductions because no personal funds are being invested in the cost, maintenance or operation of the vehicle. Even if a truck driver drives a personal vehicle to his place of business, the costs related to the vehicle ownership, maintenance and operation are not deductible as a business expense. An exception can be made with a business-only vehicle leased in the name of a business. For example, a general contractor who drives a vehicle leased under his company name back and forth to work sites and appointments may deduct the costs associated with this expenditure.
Mileage Depreciation and Other Deductions
The standard mileage rate as of the date of publication is 50 cents per mile. If you choose to use the standard rate you must count it the first year the vehicle is used for business purposes; in subsequent years you may opt for standard mileage deduction or actual expense deductions. You must use standard deductions for leased vehicles during the entirety of the lease. First year depreciation limits on trucks as of the date of publication is $11,160, and if self-employed, you may deduct interest paid on a truck loan. Other costs that may be eligible for deduction include road tolls and parking fees.
Tracking Eligible Deductions
Keep written records of deductible travel-related expenses, such as a mileage log and receipts, and separate costs where necessary. For example, if you are self-employed and use a company-owned vehicle for personal use 10 percent of the time, you can only count 90 percent of the eligible deduction for the vehicle as work-related.