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Saturday, January 20, 2018

Ending the confusion over per diem
Article thanks to and Brian Straight. Links provided:

Jan, 2018  For years, truck drivers have collected a per diem for meals when on the road. Whether you were a company driver or owner-operator, you could take the daily per diem of $63 and deduct it off your taxes, if you itemized. In the last few weeks, there has been a lot of confusion in the driver community regarding the per diem, which has been eliminated for company drivers under the new Republican tax plan.
The confusion has arisen over whether owner-operators could continue to use the per diem or not, and what can company drivers do with this seemingly large taxable expense that has just been dumped in their laps.
“The [company] driver lost the ability to deduct the per diem,” explains Kevin Rutherford, owner of Let’s Truck who advises drivers on tax preparation. “For the owner-operator, nothing changes.”
According to Rutherford, owner-operators (and leased drivers) will be able to continue using the per diem and deducting it on their taxes through Schedule C or on their corporate return. For a driver on the road 250 days a year, that’s $15,750 of potential deductions. Combined with other business expense deductions, and the new 20% deduction on pass-through corporations (if your business is structured this way), there are still plenty of tax benefits.
For company drivers, though, the situation is a bit cloudier. They have lost that $63 deduction, but individual (or married) tax filers receive the larger standard deductions ($12,000 for individuals, $24,000 for married filing jointly) now available. Will those deductions be enough to offset the loss of the per diem? That depends on the individual tax situation of each driver.
It could become an important driver benefit issue moving forward, Rutherford says, as carriers could still offer the $63 as a pre-tax benefit, if they choose.
Avery Vise, vice president of trucking research at FTR Transportation Intelligence, said in a conference call last week that it remains to be seen what fleets will do. “Carriers that do not offer per-diem pay might encounter driver dissatisfaction once [drivers] understand what has happened,” he said. “How that plays out is something to watch, particularly when it comes to recruiting and retention.”
Rutherford thinks it’s likely that carriers will begin to offer it as an incentive to both attract and keep drivers. In a recent blog post on the Let’s Truck website, Rutherford explains. He highlighted the text from the tax bill that he believes is relevant. It reads: “Under the provision, business expenses incurred by an employee are not deductible, other than expenses that are deductible in determining adjusted gross income (that is, above-the-line deductions).”
He outlines a potential scenario under the old law and the new tax law to show the difference the per diem makes on taxes. In 2016, a driver on the road for 300 days would be eligible for about $15,120 ($63/ day times 300 days adjusted to 80% = $15,120) as a per-diem itemized deduction. That means they would not have taken the standard deduction ($12,000 for married or $6,000 single filing status) but would have $15,120 as “tax-free” income.
Under the new tax plan, and if a carrier provides per-diem to drivers on a pre-tax basis, the driver would receive $18,900 essentially tax free for the per diem. In addition to the new standard deduction amounts of $24,000 for married and $12,000 for singles, it would mean a driver would receive as much as $42,900 tax free for a married driver filing a joint return.
Using some basic numbers (each individual tax situation is different and these numbers are for illustrative purposes only, he advised), tax consultant Mark Sullivan provided Let’s Truck with an example of a driver that receives per diem and one that doesn’t.
For the driver that does not receive per diem, making an average salary of $50,400 and taking a standard deduction of $24,000, he would have taxable income of $26,400 and pay taxes of $6,643. That would be a $737 savings over their 2017 taxes based on itemized deductions of $12,592 and exemptions of $8,100.
When comparing that to an employee driver who receives paid per diem of $15,750, it doesn’t compare. This driver, using the same numbers, would have taxable income, after the $24,000 standard deduction, of just $10,650 and a total tax bill of $3,735, resulting in a $3,645 savings over their 2017 taxes.
Some carriers already pay per diem for their drivers, but the potentially large tax savings for drivers may make those fleets even more attractive going forward, and forcing more carriers to offer per diem as a part of their benefit packages.
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Wednesday, January 17, 2018

Which States Are Riskiest for Driving in Snow?
Article thanks to Links provided:
Ever wonder which states are the most dangerous for driving after a snowstorm?
SafeWise, a safety-themed website, analyzed federal crash data from 2016 and compiled a list of the top 10 most dangerous states for driving in the snow. Researchers used data from the National Highway Traffic Safety Administration to calculate the likelihood of a snow-related accident occurring per 100,000 people in the state.
Here are the results:
  1. Wyoming
  2. Vermont
  3. Montana
  4. Idaho
  5. Maine
  6. Michigan
  7. Iowa
  8. New Mexico
  9. Minnesota
  10. Nebraska

Saturday, January 13, 2018

Tax bill likely sunsets meal per diem for drivers, cuts rates across the board
Article thanks to James Jaillet and Links provided:
Dec, 2017  The tax reform bill likely to be signed into law by President Trump this week or next 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, he and his firm are still reviewing the details of the bill, he says, and expect to be able to speak more authoritatively in the new year about the changes it institutes.
Owner-operators will still be able to deduct meal expenses on their annual Schedule C tax form, due at the time of their annual filing, he says.
The axing of the per diem by Congress’ overhaul of the U.S. tax system, as with changes in other itemized deductions, is intended to be offset by a big bump in the standard deduction granted to all filers. That will increase to $24,000 from the previous $12,000 for married couples filing jointly.
“There is no need to itemize” the per diem deductions after the bump, says Amen, “because they’d still probably be below the standard deduction.” The standard deduction for single filers will jump from $6,300 to $12,000. What’s more, the child tax credit – an amount subtracted directly from parents’ tax bills, not their taxable income — will be doubled to $2,000 per child. However, the bill eliminates the $4,050 personal exemption afforded by current tax law.
The Tax Cuts and Jobs Act, which passed the Senate late Tuesday and should be passed by the House on Wednesday, slashes income tax rates across the board for individuals and cuts the corporate tax rate from 35 percent to 21 percent. (Update: The bill has passed both chambers of Congress and has been sent to President Trump to sign.)
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 in Congress will  establish 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 a 22 percent rate.
The bill also cuts tax rates for higher earners, instituting new rates of 24 percent, 32 percent, 35 percent and 37 percent, down from the previous 28 percent, 33 percent, 35 percent and 39.6 percent rates under current law.
No Obamacare penalty
The GOP bill also eliminates the tax penalty instituted by the Affordable Care Act for not carrying health insurance. Many owner-operators have resisted getting coverage and have been subject to paying hundreds of dollars each in penalties that increased every year since Obamacare took effect. However, this change does not take effect until the 2019 filing year (due April 2020).
Thinking ahead to 2018 filing
Traditional tax planning has been to accelerate expenses ahead of Jan. 1 and delay revenue beyond Jan. 1. That strategy will be worth even more this year because of the lower tax rates.
Given that tax rates are dropping next year, Bridges says it would be wise of owner-operators — and all businesses — to defer any income they can until after the new year rolls around. Checks deposited in January will be taxed at lower rates than checks deposited before year’s end.
Operators also would be wise to take on any necessary expenses before the end of the year, such as maintenance/repair work or buying business supplies, as a means to maximize their deductions for the 2017 filing year, given that 2017’s rates will be higher than 2018’s.
“You’re going to get much more benefit from [those expenses this year] than if you wait even until January,” says Bridges. “So if somebody needs a new transmission or a new set of tires, they’re going to be significantly better off to get those now and take the deduction for 2017.”
Amen says owner-operators should also pay before year’s end any state and local taxes due for the fourth quarter of 2017, as the tax reform bill removes those deductions, and paying them in January will restrict operators from deducting them from their taxable income for this year and next year.
Fleets win big in new corporate rate
Carriers will likely see some of the larger benefits offered by the bill in Congress, due to the new 21 percent corporate tax rate.
“Trucking companies will see a huge benefit at year’s end when they file their 2018 tax returns,” says Bridges. “One of the things [lawmakers] hope companies use that for is as a growth mechanism and to increase compensation to their people.”
Ultimately, though, Bridges says the bill “offers a little something for everybody.”
“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.”

Wednesday, January 10, 2018

Ford Confirms Focus RS Engine Woes; Company Working on a Fix
Article thanks to Steph Willems and Links provided:

Dec, 2017  It’s not just scorched rubber that’s responsible for the clouds of white smoke surrounding some Ford Focus RS models. The model’s high-output 2.3-liter EcoBoost four-cylinder, credited with turning the staid Focus 5-door into a performance hatch worthy of fanboy lust, seems to have a serious flaw.
Numerous complaints of white exhaust smoke seen during cold startups has forced the automaker to admit there’s a problem with the FoRS. The 2.3-liter is not electing a new Pope, as TTAC’s Matthew Guy quipped this morning — it’s burning coolant.
According to Autocar, 2016 and 2017 Focus RS models with as little as 6,000 miles on the odometer are experiencing the issue. Of course, Blue Oval fans who regularly visit the forum already know something’s up, as the site’s dedicated “failed/leaking head gasket resource thread” currently has 247 pages of complaints and discussion.
While there’s no recall for the issue, a Ford spokesman told Autocar that the automaker is “working on a repair for all customers,” implying a solution that spans all owners, not just those with complaints.
“In the meantime, if vehicles show these symptoms, customers should visit their dealer for an inspection and repair under warranty,” the spokesman said.
At least one American 2016 owner has taken their coolant-related complaint to the National Highway Traffic Safety Administration. The Georgia driver’s complaint is straightforward:
While the issue sounds like a simple head gasket failure, it seems that’s not necessarily the case. Owners claim block distortion experienced over multiple heat cycles creates an opening between the engine block and cylinder head that the gasket can’t seal, thus allowing coolant to enter the cylinders when cold. The fact that some owners have received new engines built to a different spec adds to the theory.
Owners of other 2.3-liter EcoBoost Ford products shouldn’t worry, as the RS engine uses a different aluminum alloy in its block, cast-iron cylinder liners, and has its own head gasket design.
All Focus RS models were built at the company’s Saarlouis, Germany assembly plant. After entertaining Europeans for years, the model entered the hot hatch Hall of Fame after making a long-awaited trip to North America in late 2015. The current generation dried up after the release of 1,500 Special Edition 2018 models tuned by Ford Performance.

Saturday, January 6, 2018

FMCSA Orders Washington State Trucking Company To Cease Activities
From the "stupid trucker" file, Article thanks to Jake Tully and Links provided:

Dec, 2017  In a press release issued by the Federal Motor Carrier Association (FMCSA) earlier today, the U.S. Department of Transportation agency reports that it has ordered Even Flo Logistics, a Tumwater, Washington-based trucking company to cease operations due to the posing a hazard to public safety.

According to the FMCSA, Even Flo Logistics has been ordered to stop both interstate and intrastate activates after investigators found the company to be an “imminent hazard to public safety.”
Additionally, the FMCSA reports that it served an imminent hazard order to Shawn Roberts, a truck driver for Even Flo Logistics, prohibiting Roberts from operating a truck or other commercial vehicles in interstate commerce.
The FMCSA reports that the order served to Roberts was given due to the drivers, “"…. blatant disregard of [federal safety regulations] and continued disregard for the safety of the motoring public …. substantially increases the likelihood of serious injury or death to you and/or to the motoring public."
The FMCSA said that the Washington State Patrol Motor Carrier Safety Division conducted a compliance investigation of Even Flo Logistics in August 2017 after roadside inspections across multiple states over the course of the year revealed large safety violations that saw Shawn Roberts operating outside of the out-of-service at a rate of more than 13 times than what the national average has reported.

In addition to the roadside inspections, the FMCSA also found that Roberts operated a commercial vehicle holding only a learner’s permit on at least two occasions and that Even Flo Logistics allowed Roberts to operate in interstate commerce on at least one occasion during a period in which the State of Washington had suspended or withdrawn his CDL.

The FMCSA has also reported that Even Flo Logistics did not ensure that testing for controlled substance and alcohol was properly conducted within a necessary time frame, nor was post-accident testing proctored in an official manner.

Washington State Patrol investigations ultimately gave that motor carrier a federal safety rating of “Unsatisfactory” reports the FMCSA, in which the company was ordered to stop operations on October 10, 2017.

Despite this order, reports the FMCSA, Even Flo Logistics was found operating on at least two occasions.
Among the offenses that Roberts was cited for, the driver saw citations for operating a commercial motor vehicle without a valid commercial driver’s license, being on the influence of narcotic drugs/amphetamines while on duty, possessing an intoxicating beverage while on duty or driving, among other offenses.
The FMCSA reports that Roberts has been involved in four crashes since January 2017 and is facing drug-related criminal charges in both Arizona and Wyoming.

Roberts also reportedly posted a photo on his social media account of a 12-year-old operating a truck and in July 2017 Roberts posted a photo of a metal clamp attached to a gas pedal of a commercial motor vehicle alongside the caption “When your cruise control brakes [sic] the fix."

The FMCSA reports that Even Flo Logistics may be assessed for civil penalties up to $26,126 for each violation relating to the out-of-service order, as well as a potential fee of no less than $10,000 in civil penalties for providing transportation requiring federal operating authority registration.
Separate of Even Flo Logistics, Roberts may be assessed a civil penalties fee of up to $1.811 for each violation of operating a commercial motor vehicle in violation of the imminent hazard order.