As a truck driver, the open road is your office, and your truck is your business. Every mile driven, every fuel stop, and every meal on the go is a business activity, but navigating the complexities of tax deductions can feel like a detour you are unprepared to take. Still, understanding what you can claim is vital for an owner-operator, so you cannot afford to not know the answer to the question, What expenses can a truck driver claim in California? A comprehensive list of potential write-offs and a system to track them can significantly reduce your tax liability and improve your bottom line.
At NorthStar Bookkeeping, we work with businesses to help them understand their financial picture and ensure their records are organized, accurate, and ready for tax time. We can clear your financial outlook of any uncertainty or obstacles so your path to greater financial success feels more like cruising down the Pacific Coast Highway. Keep reading to learn what expenses you can claim.
What Expenses Can a Truck Driver Claim in California?
The expenses you can claim depend on whether you are a W-2 employee or self-employed. If you are a W-2 employee, you will face more limitations. If you are self-employed, however, you could possibly claim more expenses when you file IRS Schedule C (Form 1040), Profit or Loss from Business.
Still, that’s just scratching the surface. The following information provides key insights into the categories of deductions you can claim as a truck driver.
Related Article: How to Reduce Accounting Errors with Professional Bookkeeping
Who Can Claim Truck Driver Expenses?
As we mentioned, the ability to claim tax deductions hinges on your employment status. Many deductions only apply to self-employed drivers and owner-operators who file IRS Schedule C (Form 1040), Profit or Loss from Business. If you are a W-2 employee, you may not be able to claim these.
In California, this can be particularly complex, as you may be classified as an independent contractor at the federal level but as an employee for California purposes. This is why working with a knowledgeable bookkeeping partner is so important.
Heather Kirstein, co-owner of NorthStar Bookkeeping, explains, “The first step toward financial clarity is understanding your business structure and how it affects your tax obligations. For truck drivers, this means recognizing the difference between employee status and being an owner-operator. This distinction directly impacts your ability to claim expenses and is the foundation for an organized financial system. We help our clients identify their tax-filing needs so they can build a proper strategy from the ground up.”
Related Article: How to Do Bookkeeping for Truck Drivers in Tustin, California
What Expenses Can a Truck Driver Claim in California?
The general rule for tax-deductible expenses is that they must be ordinary and necessary for your business. While this is not an exhaustive list, let’s get into some of the most common expenses that a truck driver can claim that you should be tracking to illustrate what deductions can look like.
Related Article: How to Track Company Expenses: 5 Smart Solutions for Receipt Management
Vehicle Costs
Your truck is your primary asset, and its operational costs are a major source of deductions. Unlike drivers of smaller vehicles, who can sometimes use the standard mileage deduction, truck drivers must deduct actual expenses. This is why meticulous record-keeping is critical. These costs include:
- Fuel, oil, and other fluids. This is often one of the largest expenses you can claim.
- Repairs and maintenance. This covers everything from routine oil changes and tire replacements to unexpected mechanical work.
- Insurance. Premiums for commercial auto liability, property damage, and cargo insurance are deductible.
- Loan interest and lease payments. If you financed or leased your truck, the interest you pay is deductible.
- Tolls and parking fees. These costs add up quickly on the road and can be fully deducted.
- Truck washing. The cost of cleaning your vehicle is a deductible business expense.
Travel and Meal Expenses
When you are away from your home overnight for work, you can deduct expenses for lodging and meals. While you must keep receipts for lodging, a special per diem rate simplifies the process for meals.
- Per Diem Allowance: The IRS sets a special daily rate for meals and incidental expenses (M&IE) for the transportation industry. You can deduct a set amount for each day you are away from your tax home overnight, which saves you from having to save every single meal receipt. As of October 1, 2024, the M&IE rate for travel within the continental U.S. is $80 per day, and you can deduct 80% of that amount.
- Lodging: Hotel or other accommodation expenses are deductible, but there is no standard per diem rate for these costs, so you must keep all receipts.
Tools, Equipment, and Supplies
You can deduct the cost of tools and equipment that are ordinary and necessary for your job.
- Safety gear and tools: This includes items like chains, tarps, wrenches, flashlights, and safety equipment.
- Sleeper berth supplies: Items for your sleeper berth, such as bedding, a cooler, a small refrigerator, or a coffee maker, are deductible.
- Office supplies: Paper, pens, calculators, and other supplies used for record-keeping are deductible.
For more information on how to get your financial books in order, contact us at (714) 608-1526 to talk about outsourced bookkeeping for your business.
Related Article: What is a Chart of Accounts and Why You Need One
Why a Truck Driver Expenses Spreadsheet is Your Best Tool
The most important part of claiming deductions is accurate record-keeping. Without proper documentation, you cannot claim a deduction. A truck driver expenses spreadsheet or truck driver expenses worksheet is an invaluable tool for organizing your finances.
These tools allow you to create a comprehensive truck driver expenses list and categorize your spending. When tax season comes around, filing your taxes will not just be easier, but it also ensures you maximize your savings while avoiding costly penalties for misfilings or errant reporting.
Paul Yee, co-owner of NorthStar Bookkeeping, says, “Many truck drivers are masters of the road but can be lost when it comes to organizing their receipts and financial data. A simple spreadsheet is the first line of defense against financial disorganization. By consistently logging expenses for fuel, tolls, and maintenance, you are not just preparing for tax season; you are giving yourself real-time insight into your operational costs. This simple act is the difference between guessing your profitability and knowing it for sure.”
Related Article: How Bookkeeping Services Can Simplify Your Financial Outlook
Get a Clear Financial Picture
So, what expenses can a truck driver claim in California? This depends on your unique employment classification. Regardless, it’s still important to keep in mind that in addition to the expenses above, you may also be able to deduct a portion of costs for your cell phone, internet service, and industry-related subscriptions. Certain medical expenses, such as the cost of required exams and fees for your CDL and professional associations, can also be claimed.
Kirstein explains, “The list of deductible expenses for a truck driver is extensive and can be difficult to manage, especially without extensive training in this unique financial niche. The number of receipts for fuel, tolls, and meals can feel overwhelming. We can help you implement a system to capture all of this information digitally, ensuring that every valid expense is recorded. This process turns a stressful, manual task into a streamlined part of your business operations.”
Yee adds, “Our role is to be more than a bookkeeper; we are a strategic partner in your business. By providing precise bookkeeping and customized financial reports, we help you understand where your money is going and where you can improve profitability. This level of clarity helps you make informed decisions, whether it is about managing your fuel costs or planning for a major repair.”
NorthStar Bookkeeping serves businesses in Orange County, CA, and across the United States. We are ready to help you get your company’s accounting and administration on track so you can focus on the road ahead with confidence.
Contact us at (714) 608-1526 to talk about outsourced bookkeeping for your business.