5 Business Deductions for Trucking Taxes
Nobody enjoys paying taxes. As a trucking operation, taxes are a major cost of doing business. Between fuel, tolls, and taxes on tires, parts, and of course Federal income tax, your company has plenty of reasons to keep a sharp eye on how to mitigate your tax obligations.
Luckily, the IRS tax code provides at least a few deduction opportunities that could end up saving your trucking business big dollars. Here is a quick list of five business deductions that can save you on your taxes this year:
1. Medical Expenses and premiums
If you are not covered by a spouse’s employer and your company is covering your medical expenses, these costs, including your insurance premiums, may be deductible.
These days every business, including trucking, relies on technology to conduct business and stay ahead of a fast-changing business environment. The good news is things like cell phones, GPS devices, laptops, printers, and software are probably deductible. So are expenses related to your office; even those small things like copying, postage, pens, paper, etc. are supplies that you may deduct–even envelopes and business cards—that appear to be small expenses until you add up these costs over the course of a year.
3. Membership Dues and Fees
If you belong to an association, did you know that those dues are deductible? So are fees you might pay related to dispatching, as well as the cost of your CDL license. Subscriptions to publications related to your business are also deductible.
4. Uniforms and Equipment
As small business, you can deduct special uniforms or work clothes. But that’s not all. You can also deduct the cost you incur for items related to doing your job, including things like equipment blankets, chains, and tools, as well as locks or straps used to perform your work.
5. Road Expenses
From meals and business travel expenses to the fuel you buy related to your trucking business may be deductible expenses.
A Word About the Section 179 Deduction
We would be remiss if we didn’t mention the opportunity you have as a small business to take advantage or the Section 179 Deduction. The tax code offers this unique deduction for businesses as an incentive to invest in new equipment. The 179 Deduction was designed specifically for small business. It offers a small business to take accelerated deduction of up to $1.08 million in depreciation on up to $2.7 million in purchases in a single calendar year. That means you can deduct the full purchase (or lease) price of equipment—including most business vehicles like cargo vans—in the year purchased. It can be used for machinery, like presses, packaging equipment, or even software investments or support equipment fork lifts. And yes, most over the road tractor trailers should qualify for the deduction. There are special rules for vehicles over 6,000 pounds. You can read more about depreciation deduction on the IRS document referenced here.
With all of these opportunities to save money on your taxes, you would more than likely find that doing your own Federal and State Taxes, as well as your required quarterly tax filings, might be a bit much to handle yourself. To ensure you get the maximum deductions possible, feel free to reach out to our office for a no-obligation consultation about your unique situation.