An employee truck driver asked the following question to the Per Diem Plus tax experts during the 2016 MidAmerica Truck Show: "Is cent per mile or IRS daily rate per diem better for a driver?"
The cent per mile per diem method has been the transportation industry standard for decades and is most often utilized by fleets who offer employee drivers company paid per diem. Under the cent per mile method a driver is paid only for miles driven and not nights away from home.
Although, a driver may travel 500 miles one day but only 250 miles the next, the distance traveled does not affect the need to eat three meals a day. To remedy this problem the IRS introduced the Special Transportation Industry* daily rate per diem that ignores miles traveled and relies on days away from home. The most beneficial aspect to a driver is that per diem can be claimed during a 34 hour restart and unforeseen delays like breakdowns, waiting for permits or weather.
The table below illustrates the advantage of choosing daily rate per diem:
This article was written by D R Sullivan & Company, CPA PC, an accounting firm that has been providing taxpayer advocacy, consulting, and litigation services since 1998. The firm has nearly a decade of experience advising large fleets and telematics providers on IRS substantiated per diem and is tax counsel for Per Diem Plus, an automated per diem and expense tracking Android app.
Please remember that everyone’s financial situation is different. This article does not give and is not intended to give specific accounting and/or tax advice. Please consult your own tax or accounting professional.
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