For small business owners, tracking deductions and expenses – or anything to do with taxes, let’s be honest – is a hassle. For trucking owner-operators, however, it’s a hassle well worth the effort. You’re unique because you can claim expenses in ways other small businesses can’t, which can save you a lot of money come tax time.
Tracking your expenses and knowing what you can deduct helps you keep track of your net profits, making it easier to pay your taxes at the end of the year. Remember your Net Profit(what you’ll pay taxes on) = your Gross Pay – Allowable Expenses.
What you can claim for your tax deductions will vary depending on how you set up your trucking business. Fortunately, the IRS has a Trucking Center will information specific to the needs of owner-operators and other truckers. Fortunately, most owner-operators share common expenses that can be deducted at the end of the year (be sure to check with the IRS about the specific deduction rules). Some of these expenses include:
As you can see from the list above, if you spend money related to your business as an owner-operator, you need to track it for tax purposes. From spreadsheets to complex tax software, everyone has a favorite way to track their business expenses. One of the most important things to keep track of, no matter how you record expenses, are your receipts. You’ll need them for tax time and you want to keep them in the event of an audit.
Keep track of physical receipts in a dry, secure organizer that allows you to organize them in a way that is easy for you to find.
Keep track of electronic expenses on a secure hard drive. As with physical receipts, organize them in a way that will be easy for you to find the receipts you need. DO NOT rely on keeping receipts in your email or on pulling them from a store account. If you use cloud storage (such as DropBox or Google Drive) it is a good idea to also have a physical backup for important documents such as receipts.
Enjoy all of the pros and none of the cons of being an owner-operator with REY Logistics. REY gives you the ability to
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