Ask ten truckers how per diem works and you’ll get eleven answers, at least three of them from a guy at the Love’s who swears he read it somewhere.
With the IRS setting its rates for the fiscal year that starts Thursday, Oct. 1, now is a good time to clear things up.
The Rates Hold Steady for Another Year
The headline is short: nothing changed. The IRS special meals and incidental expense rate for transportation workers stays at $80 a day inside the continental U.S. and $86 outside it, FreightWaves reported. (Rates for the separate high-low method used by some employers did tick up, per the IRS notice.)
But who actually gets to use that $80?
Who Qualifies for Per Diem
Under IRS Publication 463, the transportation rate is for people whose work directly involves moving goods or people and regularly takes them away from home. A driver generally needs three things:
*
A tax home. That’s the city or area where you regularly live and work. A driver with no regular home base, who lives full-time in the truck, may not qualify at all.
*
Time away overnight. The trip has to keep you out long enough that you need sleep or rest before heading back. Local day routes don’t count.
*
Records. Your ELD and logs showing dates and locations are usually the best proof you’ve got.
Drivers under federal hours-of-service rules can deduct 80% of the meal allowance instead of the usual 50%. On days you leave or return home, you get 75% of the daily rate.
Owner-Operators: It’s a Deduction
If you’re self-employed, whether leased on or running your own authority, per diem is a business deduction on your tax return. The math: $80 times 80% comes to $64 for every full day out, and $48 for a departure or return day. Two hundred full days on the road adds up to $12,800 in deductions.
Company Drivers: It Comes Through Payroll
This is where the confusion lives. W-2 company drivers cannot deduct per diem on their federal return. The 2017 tax law suspended deductions for unreimbursed employee expenses, and the 2025 One Big Beautiful Bill Act made that permanent.
That doesn’t mean company drivers are out of luck. Many carriers pay per diem through payroll, so part of each check is a tax-free reimbursement rather than taxable wages. If your carrier offers it, you get the benefit on every check. If it doesn’t, you can’t make it up at tax time.
One trade-off to know: because per diem pay isn’t taxed as wages, it can also shrink the earnings reported for Social Security and the income a lender sees on your W-2. Worth weighing before you sign up.
The Alabama Difference
Alabama company drivers have one advantage. Unlike the federal return, Alabama still lets employees itemize unreimbursed business expenses, including travel and meals, above 2% of adjusted gross income, using federal Form 2106 on the Alabama Schedule A. You can itemize on your state return even if you take the standard deduction on your federal return.
