Truckers: Pay Less in Taxes with These 2025 Hacks!

Introduction

Truck drivers, whether owner-operators or independent contractors, face a tough reality: overpaying taxes due to missed deductions can erode hard-earned profits. Inexperienced CPAs often overlook industry-specific tax breaks, leaving truckers frustrated and financially strained. Are you maximizing every tax-saving opportunity available to your trucking business?

At Kewal Krishan & Co, our expert tax advisors help truckers save an average of $50,000 annually, potentially totaling $1 million over a decade. This blog reveals the top tax hacks for truckers in 2025, backed by Internal Revenue Code (IRC) provisions, with clear examples and steps to minimize your tax bill. From per diem allowances to equipment depreciation, these strategies are tailored to your on-the-road lifestyle. Start saving now with insights linked to Our Tax Planning Services.

Top Tax Hacks for Truckers in 2025

Under IRC § 162, business expenses must be ordinary and necessary, with strict substantiation for travel under IRC § 274(d). Below are key tax hacks for truckers, reported on Schedule C (Form 1040) for sole proprietors, Form 4562 for depreciation, and Form 2290 for heavy vehicle use tax.

1. Per Diem Allowances

Truckers under DOT hours-of-service rules can deduct meal and incidental expenses using per diem rates ($80/day full, $60/day partial in 2025, 80% deductible) without receipts, per IRS Notice 2024-66 and IRC § 274(d).

2. Vehicle Depreciation

New or used trucks qualify for 40% bonus depreciation under IRC § 168(k) or Section 179 expensing (up to $1.22 million, adjusted for inflation) if used over 50% for business.

3. Fuel and Maintenance

Fuel, repairs, and maintenance for business-use trucks are fully deductible under IRC § 162, provided records substantiate usage.

4. Tolls and Parking

Highway tolls and parking fees incurred during hauls are deductible under IRC § 162, critical for long-haul drivers.

5. Equipment and Supplies

Costs for tools, GPS devices, and other trucking supplies are deductible under IRC § 162, supporting operational efficiency.

For detailed rules, see IRS Publication 463.

Detailed Example: Maximizing Trucker Deductions

Consider Sarah, an owner-operator with $150,000 gross income in 2025. Her expenses include:

• Per Diem: 200 days at $80/day = $16,000, 80% deductible = $12,800 (IRC § 274(d)).
• Depreciation: $50,000 truck, claiming 40% bonus depreciation ($20,000) under IRC § 168(k), plus $6,000 standard depreciation (7-year property).
• Fuel/Maintenance: $40,000 for diesel and repairs.
• Tolls/Parking: $5,000.
• Equipment: $10,000 for GPS and tools.

Total deductions: $12,800 (per diem) + $20,000 (bonus depreciation) + $6,000 (standard depreciation) + $40,000 (fuel/maintenance) + $5,000 (tolls) + $10,000 (equipment) = $93,800. After deductions, Sarah’s taxable income drops to $56,200. With self-employment tax (15.3% on net earnings, half deductible under IRC § 164(f)), her tax liability at a 24% bracket is ~$13,488, versus $36,000 without deductions—a savings of over $22,500.

Alternative Scenario

If Sarah elects Section 179 to expense the full $50,000 truck, her deductions rise to $107,800, reducing taxable income to $42,200 and taxes to ~$10,128, saving an additional $3,360.

Step-by-Step Guide for Taxpayer Compliance

To claim these deductions and comply with IRS rules, follow these steps:

1. Track Expenses: Log mileage, fuel, repairs, tolls, and per diem days using apps or paper records per IRC § 274(d).
2. Choose Deduction Method: Opt for per diem or actual meal costs; standard mileage (67 cents/mile in 2025) or actual vehicle expenses per IRC § 162.
3. Calculate Depreciation: Use Form 4562 for Section 179 or bonus depreciation (IRC § 168(k), § 179).
4. File Form 2290: Report heavy vehicle use tax for trucks over 55,000 miles by August 31, 2025, for July usage, per IRC § 4481.
5. Submit Returns: Report on Schedule C, Schedule SE for self-employment tax, and Form 1040 by April 15, 2026, or extend with Form 4868.
6. Retain Records: Keep receipts, logs, and Form 1099-B for at least three years per IRC § 6001.

Explore Our Business Tax Services for tailored trucking strategies.

Common Pitfalls to Avoid

• Inadequate Substantiation: Travel deductions require detailed logs (date, place, amount) per IRC § 274(d).
• Personal Use of Vehicle: Only business-use percentage of truck expenses is deductible under IRC § 162.
• Missing Form 2290: Failure to file by the deadline incurs penalties under IRC § 4481.
• Overlooking Per Diem: Not using per diem rates complicates meal deductions and increases audit risk.

Why Work with a Tax Expert?

Trucking tax rules are intricate, and generic preparers may miss per diem or depreciation benefits, costing you thousands. Kewal Krishan & Co ensures every eligible deduction is claimed, minimizing taxes while avoiding IRS scrutiny. Our expertise shines in Our Tax Litigation Services.

Conclusion

These 2025 tax hacks—per diem, depreciation, fuel, tolls, and equipment—under IRC provisions can significantly cut your tax burden as a trucker. Proper documentation and strategic planning are key to maximizing savings and ensuring compliance. Don’t let overlooked deductions shrink your profits—act now to optimize your tax strategy.

Call to Action

Schedule a consultation with Anshul Goyal, CPA EA FCA, a licensed U.S. CPA and Enrolled Agent, admitted to practice before the IRS, specializing in tax litigation and cross-border tax for U.S. businesses and Indians in the U.S. Contact us at Kewal Krishan & Co to maximize your trucking deductions.

About Our CPA

Anshul Goyal, CPA EA FCA, is a licensed U.S. CPA and Enrolled Agent, representing clients in IRS tax litigation and assisting with cross-border tax compliance for U.S. businesses and Indians in the U.S. His expertise ensures tailored strategies that maximize savings and ensure compliance.

Disclaimer

This blog provides general information for educational purposes only and does not constitute tax, legal, or financial advice. Tax laws change frequently, and individual circumstances vary. Consult a qualified tax professional before making decisions. The author and firm disclaim liability for actions taken based on this content.

FAQs

1. What’s the 2025 per diem rate for truckers?

$80/day (full), $60/day (partial), 80% deductible for DOT-regulated drivers (IRS Notice 2024-66).

2. Can truckers deduct all vehicle costs?

Yes, for business-use trucks, including fuel and repairs (IRC § 162).

3. What’s bonus depreciation in 2025?

40% for qualifying trucks placed in service (IRC § 168(k)).

4. How to handle self-employment tax?

Pay 15.3% on net earnings; deduct half on Schedule 1 (IRC § 164(f)).

5. When is Form 2290 due?

By the last day of the month after first highway use, typically August for July (IRC § 4481).