In early October, President Trump took the stage in an airplane hangar near Harrisburg, Pennsylvania to rev up support for proposed sweeping changes to the U.S. tax code. In the audience were trucking executives and some drivers, and behind the president was a tractor trailer with the message: “Win again — Lower taxes. Bigger paychecks. More jobs.” A major trucking association even helped stage the event.
Now, Trump has a bill on his desk filled with changes to the tax code, changes Republicans in the Senate and House say will accomplish the message that appeared on that trailer in Harrisburg.
“Whether they’re a driver, whether they’re an owner-operator with one or two trucks — or 50 trucks or 300 trucks — it’s going to affect almost everyone,” said Dennis Bridges, a CPA and head of the Atlanta-based eTruckerTax firm, in an article in Overdrive, a sister publication of Truckers News.
At the time of the tax rally in Harrisburg, Truckers News asked readers if they thought they would benefit from changes in the tax code proposed then. The results shows:
- 49 percent said yes
- 32 percent said no
- 18 percent said they had no idea
The trucking organization that helped Trump back in October is praising its passage, and several folks familiar with trucking and taxes say drivers have some changes ahead.American Trucking Associations President and CEO Chris Spear. “President Trump has said that ‘when trucks are moving, America is growing.’ With his signing of this bill into law, there will be more trucks on our roads, making the deliveries fueled by an expanding economy. The ATA and its members are proud supporters of this bill and welcome the countless benefits it will bring to the United States economy.”
James Jaillet, news editor for Overdrive and Commercial Carrier Journal spoke with tax experts familiar with trucking to find out the bill’s impact on the industry. Here are some of the highlights from Jaillet’s article:
- The tax reform bill is expected to be the end of the daily $63 per diem deduction allotted to truck drivers for on-road meal expenses, says ATBS president and CEO Todd Amen. However, that cut is intended to be offset by an increase in the standard deduction. That will increase to $24,000 from the previous $12,000 for married couples filing jointly.
- Dennis Bridges, a CPA and head of the Atlanta-based eTruckerTax firm, said the most immediate impact will be to company drivers, who’ll see their payroll-deducted taxes lowered as early as February, after new withholding limits take effect.
- The bill establishes a new 12 percent tax rate for single filers earning between $9,525 and $38,700 a year. Income earned between $38,700 and $82,500 for single filers will be taxed at 22 percent. Income at $9,525 and less will be taxed at a 10 percent rate. These rates replace the 10 percent, 15 percent and 25 percent brackets currently in effect. For those filing jointly with a spouse, the new 12 percent bracket covers income between $19,050 and $77,400, with income earned below $19,050 taxed at the 10 percent rate. For joint filers, income between $77,400 and $165,000 will be taxed at 22 percent.
- “Trucking companies will see a huge benefit at year’s end when they file their 2018 tax returns,” said Bridges. “One of the things [lawmakers] hope companies use that for is as a growth mechanism and to increase compensation to their people.”