Independent trucking operators are aware that they can benefit from tax rebates and incentives available in the trucking industry, and here is how they can do so??

Fuel Tax Credits and Refunds

• Federal Excise Tax Refund: Trucking business owners spot off road fuel expenses and thus pay taxes on reserved funds.
• Alternative Fuel Tax Credit: As long as you use biodiesel, natural gas, or propane for fuel, it is acceptable. As a general rule, the price of qualified alternative fuels can reach as much as $0.50 per gallon.
• Claiming: Complete Form 4136, Credit for Federal Tax Paid on Fuels, and these amounts will appear as credits.

Energy-Efficient Vehicle Incentives

• Qualified Electric and Hybrid Vehicle Credits: Electric powered or hybrid truckers stand a chance of recouping some taxes. This will depend on the type of vehicle, but in most cases, the values vary from $2,500 to $7,500.
• Alternative Fuel Infrastructure Credit: Anyone who builds electricity based fueling stations or alternative fuels refueling stations can recover a percentage of the installation amount but not more than $30,000.
• Claiming: Apply for a number of such credits under Form 8911, Alternative Fuel Vehicle Refueling Property Credit.

Heavy Vehicle Use Tax (HVUT) Credits

• Credit for Low-Mileage Vehicles: If you happen to have a vehicle that does not exceed 5,000 miles per year (determination of 7,500 miles for agricultural vehicles), you will qualify for a suspended HVUT rate or refund of the excess tax payment.
• Credit for Sold or Destroyed Vehicles: vehicles that were sold, stolen or destroyed in the middle of a given year shall apply for a proportionate tax relief for the remaining unused months.
• Claiming: Alter your tax submissions in respect to Form 2290 for the tax year online filling updates, or, claim for a refund using the Form 8849, Schedule 6.

Depreciation Deductions and Bonus Depreciation

• Section 179 Deduction: Permits truck drivers the ability to deduct the entire price of relevant vehicles and equipment during the year the purchase was made subject to some limitations. Thus truckers can be assisted on how to acquire high value trucking goods.
• Bonus Depreciation: These incorporation allows the users to write off a significant percentage of the purchases of newer and some old eligible assets up to 100% within the first 12 months that such assets have been placed into service. This would include useful business tools such as trucks.
• Claiming: Both of these deductions must be included in your business tax return. Speak to a tax professional to be sure you are using them correctly.

State-Level Credits and Incentives

• Fuel Tax Refunds: A number of states provide fuel tax refunds for off-road or specially-used vehicles.
• Green Trucking Initiatives: Certain states give grants or credits to trucks meeting certain pollution control targets or using alternative fuels.
• Incentives for Anti-Idling Technology: A number of states may extend tax credits or grants for equipment such as auxiliary power units (APUs).
• Claiming: Look in the Department of Revenue or energy programs for the potential credits, refunds, or grants provided by your state.

Employee Retention Credit (ERC)

This is a significant credit worth up to $26,000 per employee that trucking companies who kept employees during certain quarters of the COVID-19 pandemic are eligible for.

• Claiming: Consult with a licensed tax specialist to assess your ERC eligibility and amount. Amend payroll tax returns where necessary.

Work Opportunity Tax Credit (WOTC)

• Overview: You might be eligible for credits that range from $2400 to $9600 per employee if you employ eligible people from certain targeted groups, for example veterans or recipients of Public Assistance.
• Claiming: Form 5884 (Work Opportunity Credit) and appropriate documentation of employee's suitability should be filled out.

US IRS Per Diem for Truck Drivers

• Overview: While truckers are on the road, they can claim a daily per diem allowance for meals as well as for incidental costs per day transacted. In the year 2024, the per diem rate in the USA for transportation workers who are supposed to travel is $ 69 per day and $ 74 for travel purposes outside the US.
• Claiming: Document every overnight trip, as these provisions can be quite beneficial for regular travellers and maintain proper record keeping as well.

Deducting Health Insurance Premium from Taxable Income

• In most cases, self-employed truckers should be able to claim a deductible of their health insurance for tax which leads to a reduction in their taxable income. This deduction is possible when the insured does not have any employer health coverage.
• Claiming: In your adjustments against income, you should indicate it in Schedule 1 of Form 1040.

Making use of such deductions and credits can result into a great deal of savings. If you however need more info about a particular credit or further assistance regarding the filing of forms, do not hesitate to get in touch with me!

Note: For more information, visit IRS website