Truck drivers are a good portion of the country’s workforce. In fact, they make up around 3.5 million employees every year. Figuring out taxes for truck drivers can be a little more complicated than for other employees, and when it comes to tax season, some truckers are faced with tax bills they are unable to pay. This may prevent them from filing, or they may file but not pay the bill. While there is nothing illegal about owing the IRS money, it is against the law to not file for more than three years.
Benefits of a Tax Relief Company
Truck drivers who owe back taxes may feel they are in over their head. The good news is there is tax relief available. Truckers can start to get the IRS off their backs if they begin to pay back some of the taxes owed. Options for relief include installment agreement, back tax return assistance, offer in compromise and penalty abatement.
If truck drivers find themselves in a spot in which back taxes are unmanageable, it may be time to hire a tax relief company. There are numerous options, and the right choice will vary depending on each driver’s situation. A tax professional can advise as to which approach is the best one. Each approach also requires specific qualifications, and a professional can help determine these.
For example, an offer in compromise may be a good decision for some truckers. With this approach, the tax debt can be settled for an amount that is less than one owes. To apply for this, all previous tax returns need to have been filed. The IRS then determines approval based on the truck driver’s income, expenses, ability to pay debt and asset equity. A tax relief professional can help determine if this option is appropriate and help with the offer filing.
Importance of Having a Bookkeeper
There are many tax benefits that come with being a truck driver, but they can be hard to keep track of. Plus, some of the previous tax deductions, such as per-diem, are no longer available for employees per the 2017 Tax Cuts and Jobs Act. This is one of the reasons truck drivers are seeing unexpected tax bills. Getting help with bookkeeping can possibly lower these bills in the future.
One way a bookkeeper or tax accountant can help is by assisting truck drivers who are owner-operators. Because they are not considered employees, they are responsible for paying their own expenses and taxes, but there are additional deductions they may take advantage of:
- Capital and cost-of-goods expenses
- Truck maintenance and repair costs
- Union dues
- Communication and electronic devices and bills
- Permits and fees
- Personal expenses
A bookkeeper can help document these expenses, which is necessary if one wants to use them to decrease tax liability. A bookkeeper can also help keep track of estimated tax payments for those who are expected to owe the IRS money.
Being a truck driver has a lot of perks, but the tax situation can be frustrating. Whether they need tax relief advice or help organizing and recording their expenses, truck drivers can benefit from going to financial professionals like Anthem Tax Services.