Tax Tips
Are you ready? Tax time is around the corner

By Howard Abrams, PBS Tax & Bookkeeping

Q.  An over-the-road trucker called us because he is worried about his taxes. Is there still time for tax planning this late in the year?

A. You bet. There is still time to do a tax projection to see what needs to be done. You can accelerate some of your trucking expenses to reduce income. If you are short of cash, you can use a credit card to pay them and get the deduction for 2013. Or you might delay some of your trucking expenses to 2014 if your tax situation is favorable, which will have the potential of reducing taxable income in 2014. If you buy a truck or other vehicle for your business, you must put them into service before Jan.1, 2014, to get a write-off in 2013.

Also there is still time to open a 401(k) retirement plan. You must open it before Jan. 1, 2014. You don’t need to contribute until the due date of the 2013 income tax return, including extensions. You will still have until April 15, 2014, for IRA contributions. SEP-IRAs can also be funded by the due date of the 2013 return, including extensions.

Q. What paperwork and information should be put together to prepare my 2012 income taxes?

A. Listed below is what you will need for your income tax preparation. Most tax preparers have income tax organizers to help you organize your information and list what is needed.

Items you should receive by early February:

1.  W-2s.
2.  1099s from all companies and/or individuals you’ve done work for – brokers, motor carriers, independent businesses, etc.
3.  1099s or end-of-year statements from banks for interest and dividend income, stock and mutual funds and mortgage interest statements.
4.  Schedule K-1 if you are involved in any partnerships or S corporations.
5.  W-2P or 1099-R for pension and annuity income.
6.  1099s and year end statements for unemployment compensation, social security income and state income tax refund.
7.  Nights away from home for per diem.
8.  Determine whether you have, or are going to make, any contributions to an IRA, SEP-IRA, or uni-401(k) plans.
9.  Indicate any estimated taxes paid with corresponding dates.
10. Contracts for the purchase and/or sale of equipment, property including refinancing.
11. Confirmations from charities for donations in excess of $250 each.
12. Company drivers need to gather their W-2s and compute the number of nights they were gone on the road. Also, you need to compile any business expenses incurred such as union dues, telephone, clothing and laundry. You will need to deduct any reimbursement received.

Remember, if you have employees or independent contractors, you are also required to send out your W-2s and 1099s by Jan. 31. This includes self-employed individuals who have hired their children to do work for their business. You must issue W-2s to your children to get the deduction.

Q.  I am a company driver. What is the deductible when I’m on the road?

A. While self-employed individuals can generally deduct any expenses incurred to earn their income, company drivers are limited to non-reimbursed expenses required by their employer. You are entitled to deduct per diem for meals on the road and motel expenses – if you are not paid per diem pay.

A good rule to follow for deductions would be any expenses incurred that are necessary or required in the performance of your job and/or operation of the truck but are not reimbursed by your company, such as uniforms, gloves, logbooks, maps, cellphone, CB, etc. Remember, as a company driver, these deductions are available only if you itemize your deductions (i.e., not claiming the standard deduction). LL

Editor’s note: PBS Tax and Bookkeeping has a tax organizer available for download at pbstax.com.

This article is written by PBS Tax & Bookkeeping Service, a company that has been providing income tax and bookkeeping services to the trucking industry for more than a quarter-century. If you would like further information, please contact PBS at 800-697-5153 or visit their website at pbstax.com.

This column is the opinion of the writer and does not necessarily reflect the opinions of Land Line Magazine or its publisher. Please remember that everyone’s financial situation is different. This article does not give and is not intended to give specific accounting and/or tax advice. Please consult with your own tax or accounting professional.