March 30, 2022
Share this article:
If you’re new to truck driving or currently looking for a new job as a truck driver, you may be wondering about per diem pay. If you drive for a trucking company, per diem pay is non-taxable money that is paid to you to cover your meals and expenses while you’re on the road and away from home. If you’re an owner-operator, per diem refers to a tax deduction that you’re eligible for.
For both owner-operators and company drivers, per diem rates are helpful to keep in mind when budgeting and planning your trips.
For tax purposes, the IRS set the per diem rate for truckers in the continental U.S. at $69 per day from October 1, 2021 through September 30, 2022. This is an increase of $3 from the previous per diem rate that expired on September 30, 2021. This means that when you are taking your deductions, you can take up to $69 per day for every day you were working away from home during the year. You will need to keep detailed records and your receipts if you plan to take this deduction.
As for the per diem rates that trucking companies pay, they vary. Like all pay and benefits, actual per diem varies by company. When negotiating your salary at a new company, be sure to ask about per diem and factor that into your decision. Per diem can be calculated as a cents-per-mile rate or as a flat rate. Keep in mind that per diem pay is non-taxable and therefore does not count toward your 401(k) match, unemployment, Social Security, and workers’ compensation benefits.
Per diem can be used for lodging, meals, showers, and other incidental expenses that you incur while you’re working away from home. Essentially, this money is to cover any travel expenses that you would typically cover for yourself when you’re at home.
If you’re a company driver, you will not have to submit receipts or request reimbursement for expenses covered by your per diem. This makes it a lot easier on you and on the company because you won’t have to submit paperwork, and they won’t have to process a reimbursement. Different companies pay per diem in different ways. Some, like TransForce, provide a credit card before your trip; while others in the transportation industry add a per-mile rate to your regular take-home pay.
It is wise to keep your expenses below the allotted amount because the company will typically not provide additional payment in excess of the per diem rate.
There is a new tax break to be aware of for expenses incurred in tax years 2021 and 2022. Based on the Taxpayer Certainty and Disaster Relief Act of 2020, meal purchases from restaurants are now 100% deductible (as opposed to 80% previous to this law). If you’re an owner-operator, this will make calculating your per diem deductions when doing your income tax much simpler.
For company drivers, you will need to check your employer’s per diem program policy to see what affects your per diem rate. Every company is different, and the policies can be complicated. So make sure you understand their per diem policy fully before participating in the program (if given a choice).
For owner-operators, the per diem remains the same as long as you are in the continental United States. If you are driving outside of the continental U.S., to Canada for example, the per diem rate is $74 per day.