Can a truck driver have two tax homes?
“If I have two different home addresses can I claim per diem while off duty at either location? And can I claim per diem for off days spent visiting my wife in Oregon”
Background information
Can a truck driver have two tax homes? Bill is an OTR trucker who claims Las Vegas, Nevada as his tax home:
- He takes 4 days off for every 2 weeks he is on the road.
- He and his wife were married in June 2017 and listed his Nevada address where they maintain a home (a state with no income tax) on their 2017 Federal income tax return[iii].
- One year after they married she still lives 920 miles away in Oregon (a state with an income tax) where he stays with her on his off days.
- His wife picks him up at the truck stop where he parks his truck.
- Bill has been claiming per diem for every day he is away from his Las Vegas home on a truck driving trip.
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Per diem rules for OTR drivers
- Self-employed truck drivers subject to DOT hours of service regulations
- Entitled to claim per diem for meals and incidental expenses and other travel-related expense as a tax deduction.
- A truck driver is not away from home unless his or her duties require the individual to be away from the general area of his or her tax home for a period substantially longer than an ordinary workday[i].
- To claim travel-related expenses a trucker must have a tax home [where they park their truck] in a real and substantial sense[ii].
- A deduction is only allowed for ordinary and necessary traveling expenses incurred by a taxpayer while away from home in the conduct of a trade or business.
Tax home inquiry
Whether his tax home is Nevada or Oregon and whether the Las Vegas home is indeed his permanent residence for per diem purposes are factual questions resolved by the fact:
- A taxpayer can only have one tax home
- Bill acknowledged that he does not spend any off days in Nevada
- He bares household expenses in maintaining both the Las Vegas and Oregon home, and
- Visiting with his wife in Oregon on his off days does not meet the legal requirements to claim traveling expenses.
Conclusion
As this example demonstrates, per diem issues can be complicated. It would be allowed for a driver who is away from home undergoing a 34-hour restart while in transit between a shipper and consignee, but not if the restart is done at home. Although, Bill claims Las Vegas, Nevada as his tax home, the facts dictate that Oregon is his tax home in a real and substantial sense, thus he does not qualify for per diem while visiting his wife. Additionally, attempting to claim per diem for every day he was away from his Las Vegas home - 365 days in this case - would be a red flag to IRS for audit.
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About Per Diem Plus
About the Author
Mark is tax counsel for Per Diem Plus. With nearly two decades of experience advising trucking companies on per diem issues, Mark was responsible for defining the Per Diem Plus software logic rules that automatically calculates trucker per diem in accordance with IRS regulations. He also previously served as the consulting per diem tax expert for Omnitracs.
In addition to his time working with Per Diem Plus, Mark works in private practice as an Enrolled Agent at Mark Sullivan Consulting, PLLC specializing in federal tax controversy representation and consulting. He also served as the consulting and expert witness for the Federal Defenders Office and private defense counsel in financial crimes cases in multiple federal district courts. Contact Mark W. Sullivan, EA
Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.
Copyright 2023 Mark Sullivan Consulting, PLLC; Per Diem Plus, LLC. Per Diem Plus proprietary software is the trademark of Per Diem Plus, LLC.®
