This week, Andrew Erwin at Team Run Smart looked over some changes to the Owner/Operator tax codes for the new year based on issues that affect Owner/Operator truck drivers. As usual, the devil is in the details.
Section 179 and Bonus Depreciation – The limit for writing off qualified property has been increased to $500,000 for 2012. Additionally, Bonus Depreciation of up to 50% of capital investments is allowable in 2012. Watch this for more on this:
Payroll Tax Holiday Eliminated – If you are either a W-2 employee paying FICA or a 1099 Contractor that pays Self-Employment Tax, your Social Security taxes just increased to pre-2011 levels on January 1st. This means you will be paying 2% more tax on your earned income (up to a maximum of $113,700 of earned income). Find out more here.
Per Diem Changes – The 2012 per diem deduction rate remains the same at 80% of $59.00 per day. There are many deductions available to owner-operators, and company drivers, so be sure to speak with an experienced tax preparation company that knows the transportation industry.