Transportation Industry
IRS Says Fleets Face Sanctions For Overpaying Meal Expenses
Transport Topics, April, 2007 by Reiskin, Jonathan S
ORLANDO, Fla. - Internal Revenue Service officials told trucking industry financial executives that motor carriers must account properly for driver perdiem expenses or risk losing the tax-exempt status of the plans.
Robert Everitt, IRS chief technical adviser for the trucking industry, said carriers that pay drivers by the mile often make per-diem payments in excess of the $52-a-day maximum the service allows. Any amount over that limit, he said, must either be refunded by the driver to the company or be reclassified as taxable wages.
Currently, the $52 per diems are considered nontaxable reimbursement, rather than taxable income, and are used to cover meals and incidental expenses.
"Under the terms of a qualified plan, there's supposed to be a return of excess,...
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