As the owner-operator of your own rig, you are an independent business owner. Congress has written a number of provisions into the tax law to enable you to more accurately assess your income so that you can be assessed a fair income tax. If you operate as a sole proprietor, you will deduct your business expenses on Schedule C of your personal income tax return. If you are taxed as an S-corporation, then you will account for expenses on your Form 1120S.
Section 179 of the U.S. tax code allows businesses and individuals who put large dollar amounts of capital equipment, machinery or vehicles into service in a profit-making enterprise to take a first year tax deduction of up to $500,000. Certain limits and conditions apply for smaller passenger vehicles. However, large log trucks will generally qualify for the full deduction.
If you are carrying a note on your truck or on any other business-related equipment, the interest is a tax-deductible expense. This can be a significant line item for truckers operating large rigs. You can also deduct interest on a personal home loan, on loans up to $1,000,000 secured by your primary residence, or on home equity loans of up to $100,000 secured by your primary residence.
You can deduct the costs of a dedicated cell phone and the costs of all business-related transmissions. You can also deduct the costs of a CB radio you use for business purposes, Internet fees, global positioning system fees and satellite phones.
Lodging and Meals
You can deduct any lodging costs you incur on the road. You can also deduct a standard meal allowance, or per diem, for any days you spend on the road away from home. For most areas, you can deduct up to $46 per day for meals. Some higher expense areas allow for higher deductions. You should keep your drivers log books for up to three years, however, to document your travels, in case you are audited.