10 Tax Deductions for Owner-Operator Truck Drivers

As an owner-operator in the trucking industry, managing expenses is crucial for maintaining profitability. With various costs—such as fuel, insurance, maintenance, and licensing—adding up quickly, it’s vital to know that many of these expenses can be tax deductible. By leveraging on tax deductions, you can effectively reduce your business tax burden and retain more of your hard-earned income. Here’s a closer look at ten potential tax deductions available to owner-operator truck drivers.

1. Travel Costs

Owner-operators can deduct various travel-related expenses to help lower their overall tax liabilities. Deductible travel costs include:

● Fuel

● Tolls

● Parking Fees

● Lodging Expenses

It’s important to note that the IRS does not allow mileage deductions for semi-trucks, as they classify them as non-personal use vehicles. However, expenses for deadhead miles and time off can still be deducted.

2. Meals

If you’re away from home for more than a typical workday, you may claim a per diem deduction for meals and incidental expenses. In 2023, the per diem rate is set at $69 per day, allowing you to deduct 80% of this amount—$55.20 per day. Remember to keep meticulous records of:

● Travel dates

● Receipts

● Meal expenses

Stay informed on annual changes to per diem rates and regulations.

3. Maintenance Costs

Routine maintenance is vital to keep your truck operational, and these expenses can be deducted as business costs. Deductions can include:

● Repairs

● Oil Changes

● Tire Replacements

● Labor Costs

● Parts

Depending on the nature of the maintenance, you can deduct these expenses in the year incurred or opt for depreciation over several years. Consulting a tax professional is advisable for personalized guidance.

4. Equipment and Payments

If you lease your truck, lease payments are deductible as business expenses. If you own your truck, you can write off depreciation and interest paid on any loans related to your vehicle and trailer.

5. Insurance

Insurance costs tied to your trucking operations are also deductible. This includes:

● Bobtail Insurance

● Physical Damage Insurance

● Cargo Liability Insurance

Additionally, if you pay for your health insurance, you can deduct the premiums on IRS Schedule 1 (Form 1040).

6. Business Fees

Expenses directly associated with your trucking business can be deducted. This includes costs for:

● Office Supplies (paper, postage, cleaning products)

● Trucking Subscriptions

● Association Dues

● Accounting Services

● Licenses and Permits

7. Truck Supplies

You can deduct necessary tools and equipment required for your operations, such as:

● Tire Chains

● Ice Scrapers

● Snow Brushes

● Wire Cutters

● Bungee Cords

8. Medical Expenses

As a truck driver, you’re required to undergo regular medical examinations, like DOT physicals, to maintain your commercial driver’s license (CDL). Out-of-pocket expenses for these required work-related exams can be deducted. However, personal medical costs are not deductible.

9. Technology Expenses

Technology used exclusively for business purposes is deductible. This includes:

● Electronic Logging Devices (ELDs)

● CB Radios

● Internet Services

● Cell Phones

● Tablets

If any technology is used for both personal and business purposes, only the business-related portion is deductible.

10. Safety Gear

Safety equipment necessary for your operations can also be deducted. This includes items like:

● Gloves

● Steel-Toed Boots

● Reflective Vests

● Safety Glasses

To qualify, these items must be used for work-related tasks such as loading and unloading freight or operating your truck.

Understanding and utilizing tax deductions can significantly impact your bottom line as an owner-operator truck driver. Since tax regulations frequently change and each situation varies, it's wise to consult a tax or legal professional to maximize your deductions while ensuring compliance with federal and state laws.

Ready to optimize your trucking business?

Sign up with Asset Corp today and let us help you navigate your journey to success!