Tax Help for Truckers and Transportation Businesses

Trucking tax is different from ordinary self-employment because so much of the business happens on the road. Owner-operators and small fleet owners deal with per diem rules, a federal heavy vehicle use tax, fuel tax reporting across states, expensive equipment and settlement statements that deduct costs before payment. Company drivers face a very different set of rules. This page is for drivers and owners in Naperville, Aurora and the rest of Chicagoland, where major freight corridors meet, and for truckers elsewhere who file with us remotely.

Company driver, owner-operator or fleet owner

A company driver is an employee who gets a W-2. Most employees cannot deduct unreimbursed travel, so a company driver's own meals and lodging on the road are not deductible federally, unless the employer reimburses them under an accountable plan. An owner-operator is self-employed, reports on Schedule C, and pays self-employment tax. Leased-on owner-operators often receive settlements with deductions for insurance, escrow, fuel advances and fees; each charge should be matched to a clear expense or asset. A fleet owner who hires drivers must decide whether each is an employee or contractor under the IRS's behavioral, financial and relationship tests. See employee vs. independent contractor.

Per diem and the tax home

Truckers can use a standard meal allowance instead of keeping meal receipts. For travel on or after October 1, 2025, the special meal and incidental expense rate for transportation workers is $80 a day in the continental United States and $86 elsewhere (Notice 2025-54). For drivers subject to Department of Transportation hours-of-service limits, such as interstate truck operators, the deductible share of meals is 80 percent rather than 50 percent (Publication 463).

Example (simplified). An owner-operator is away from home on business for 200 days at the $80 rate. The meal deduction is 200 x $80 x 80 percent = $12,800. Partial travel days are treated differently, and lodging, laundry and other costs are separate and must be supported.

You must be traveling away from your tax home, generally the city or area of your main place of business, and your work must require sleep or rest. A worker with no regular place of business and no regular home is treated as itinerant, with the tax home wherever the work is, so travel costs are not deductible. If you live in the cab and have no real home base, ask us how the rule applies before you claim per diem. Keep a log of dates, locations and loads; ELD data, trip sheets and settlements can support it. See vehicle and mileage deductions.

Form 2290: heavy highway vehicle use tax

Form 2290 applies to highway motor vehicles with a taxable gross weight of 55,000 pounds or more. The tax year runs July 1 through June 30, and the return is due by the last day of the month after the month in which the vehicle is first used. For example, a truck first used in November 2026 would be due by December 31, 2026. On the form, tax runs from $100 for the lowest category (55,000 pounds) to $550 for vehicles over 75,000 pounds for a full year, with lower amounts for partial periods. A vehicle expected to be used 5,000 miles or less (7,500 for agricultural vehicles) can claim a suspension. Returns reporting 25 or more vehicles must be e-filed. The IRS-stamped Schedule 1 is the proof of payment you need for state registration. Late filing can bring penalties, though reasonable cause relief is available.

IFTA, IRP and registrations

The International Fuel Tax Agreement (IFTA) lets carriers report fuel tax through one base jurisdiction, based on miles driven and fuel bought in each member state. In Illinois, IFTA is part of the Department of Revenue's motor fuel use tax program. The International Registration Plan (IRP) apportions registration fees by miles in each jurisdiction. Both depend on accurate miles by state and fuel receipts, so ELD or GPS data and fuel purchase records should be saved quarterly. Federal and state carrier registrations carry their own fees and renewal dates, so keep a calendar.

Equipment and deductions

Tractors, trailers and reefers are large purchases. Property acquired after January 19, 2025 can qualify for 100 percent bonus depreciation, and Section 179 allows up to $2,500,000 for 2025. Heavy trucks are generally treated differently from SUVs and passenger cars under depreciation limits; confirm weight rating and use before you buy. Lease-purchase arrangements require reading the contract to see who owns the truck for tax purposes. See depreciation and Section 179.

Other deductible costs include fuel, repairs, tires, insurance, tolls, scales, permits, ELD and dispatch subscriptions, load board and factoring fees, tax preparation, phones and DOT physicals. Education that qualifies you for a new trade, such as initial CDL training, is not deductible.

Records and red flags

Per diem claimed with no log, personal fuel mixed with business, missing 2290 filings, round-number expenses, and drivers paid "per diem" in place of wages all draw attention. Make estimated tax payments through the year; self-employment tax is on net profit. Owner-operators with steady profit may review an S corporation with reasonable pay. See Schedule C.

How we can help

We prepare owner-operator and fleet returns, track per diem and mileage, handle payroll for drivers and support multi-state filings. See bookkeeping, multi-state tax and business tax preparation. This page is general information, not advice for your situation.

Frequently asked questions

General information only, not tax, legal or accounting advice for your situation. Rules, limits and deadlines change; confirm the current rules with the official source or a qualified professional before you act. Reading this page does not create a professional relationship with CPA Tax Payroll and Accounting Corp.