It’s good practice (and a legal issue) for every business must keep accurate records, truck drivers face unique challenges when keeping track of expenses. This includes IFTA compliance, meal deductions, truck washes, interstate taxes, and cost-per-mile calculations. A good bookkeeping service can ensure you aren’t leaving money on the table or claiming too many deductions come tax time.
Bookkeeping for Truckers
As a truck driver, you must make quarterly estimated tax payments; failure to do so can result in fines and penalties. It is also essential to keep detailed records of all your income and expenses, including food, fuel, tolls, maintenance, and vehicle registration. Having accurate, up-to-date financial records is key to understanding how your business is doing and meeting lenders’ requirements. That is why there are several companies offering accounting services for truck drivers.
For instance, bookkeeping services help you manage your financial ledgers, and many options are available to truck drivers. Some offer a mobile app that allows you to scan receipts and track mileage on the go, while others provide a prepaid envelope that can sit on your dashboard and collect receipts throughout the month. Once the envelope is filled, you can send it in and receive scanned and verified receipts, sorted into 15 common IRS categories. When selecting a bookkeeping service, look for one that offers industry-specific benchmarking and specialized trucking accounting logistics. You will also want a company with a secure portal to protect your data so you can log in and review it anytime. In addition to tracking your transactions, a quality bookkeeping service will help you prepare taxes and handle IFTA compliance. Some even have a special fuel card for truck drivers that works like a regular credit card but is tied to a unique driver number and provides fuel discounts.
Truck Driver Tax Reconciliation
If you’re self-employed or run a trucking company, you must keep detailed records of expenses and earnings. This isn’t just to ensure that your taxes are filed correctly; the IRS does not take kindly to inaccurately reported business information. A tax reconciliation service can save you time and hassle by ensuring your financial documents are accurate throughout the year.
Trucking accounting is more than just bookkeeping; it involves keeping track of fuel costs, meals, truck maintenance and washes, interstate taxes, and cost-per-mile calculations for each trip. A tax professional versed in trucking accounting can help you make sense of the unique deductions available to you, lowering your taxable income and saving you money during tax season.
Cash-based or accrual-based accounting is one of the most critical decisions a trucker or owner-operator will make. Cash-based accounting is easier, recording a transaction when money changes hands. Accrual basis accounting takes more work but is a better option for trucking companies because it records profitability more accurately.
Another consideration is IFTA reporting, which is mandatory for carriers that cross state lines or weigh more than 26,000 pounds. A trucking accountant can help you understand IFTA requirements and file your reports accurately to avoid fines. The IRS also has specific policies about how long to retain certain documentation.
Payroll for Truckers
Ensuring your drivers are paid correctly is critical as a trucking business owner. This means tracking all income and expenses, ensuring tax deductions are taken properly, and that your employees receive their paychecks on time. Fortunately, some payroll services specialize in supporting trucking businesses and their employees.
Several solutions exist for small to medium-sized trucking companies, depending on their needs. This software is easy to use and offers many permanent and contract driver pay features. Automatic local, state, and federal tax calculations are made on every paycheck, and employee access to pay stubs is available. You can also electronically file all required federal and state taxes and prepare contractor 1099s at tax time. Another great management tool option provides full-service payroll for small to midsize trucking companies and their employees. This cloud-based software allows you to manage employee and contractor payroll, track miles for customer invoicing and dispatch, and provide IFTA compliance data. The service includes various reporting choices, including year-end taxes, equipment maintenance, and insurance monitoring. Clear organization and transparent accounting are key to running a successful trucking company. This is essential for meeting all employment standards and regulations, improving road safety, and preventing costly mistakes. The bookkeeping services offered by most providers can help you do all this while ensuring your numbers are always accurate and up-to-date.
Accounting Software for Truckers
Many truck drivers use spreadsheets to manage their finances on the go, but these can be time-consuming and prone to mistakes. Accounting software programs are available that simplify the process and generate reports that can help drivers make informed business decisions. For example, another tool offers an industry-standard, double-entry accounting system with the added benefit of mobile apps that allow truckers to create professional invoices on the fly, snap photos of receipts, and accept online payments. Both owners and managers can use it, and it features an easy-to-use dashboard that shows outstanding revenue, total profit, and spending plus projections. The app automatically syncs to desktops and devices, making it easy for drivers to track expenses while on the go. It is also designed to reduce payroll processing costs by automating complex calculations and reducing the need for paper files. Additionally, it streamlines the process of filing complicated government forms and paperwork.