Driver pay, per diem and settlements without the guesswork.
Driver pay, per diem, owner-operator settlements and depreciation.
Driver pay is a compliance problem disguised as a payroll problem
Trucking payroll carries more classification and calculation risk than almost any other industry we serve. Per mile, per load, hourly and percentage-of-revenue pay structures each interact differently with overtime rules. Detention and layover pay have to be characterized correctly. And the line between a company driver and an owner-operator is exactly the line the IRS and the state examine hardest.
Misclassifying a driver who is functionally an employee creates exposure for back withholding, employer FICA, unemployment tax and penalties across every quarter it applied.
Per diem, done correctly
Per diem is the largest recurring tax item for drivers and the one most often handled badly. Under an accountable plan, a properly structured per diem is deductible to the company and not taxable to the driver, which is a meaningful benefit on both sides. Without the accountable plan documentation and the substantiation of days away from home, it is simply wages.
The rules also treat DOT hours-of-service drivers differently on the meal deduction percentage, which is an easy item to leave on the table.
Owner-operator settlements
Settlement statements are effectively a second accounting system, and in most operations they never reconcile to the books. Advances, escrow, fuel, insurance deductions and chargebacks all flow through the settlement, and if those entries are not mirrored in the accounting file, the P&L and the 1099s will not agree.
We reconcile settlements to the books so the year-end 1099 amounts are defensible.
Equipment depreciation is the biggest lever
Tractors, trailers and yard equipment represent the largest capital deployment in the business and therefore the largest depreciation planning opportunity. Purchase timing, Section 179 limits, bonus depreciation and trade-in treatment all change the outcome, and financed equipment has an interest deduction dimension as well.
This gets planned in the fall against a projection, alongside the owner compensation decision.
Talk through your trucking & logistics payroll
Bring your last return and a payroll register. We tell you what we would change and what it costs. No charge, no obligation.