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Are you struggling to keep your trucking company profitable with freight rates this low?
Do you feel like no matter what you do, the IRS keeps taking more than their fair share?
If you’re like many trucking company owners right now, you’re doing everything you can just to break even. But there’s one simple change to your payroll that could save you thousands in taxes — and help you keep more of your money.
In this article, you’ll learn how using per diem pay can reduce your payroll taxes, protect your drivers’ income, and help your company survive in today’s tough freight market.
How Per Diem Saves Trucking Companies Thousands in Taxes
Many trucking company owners think of per diem as something that only helps drivers, but the truth is, it helps your business even more.
If you’re not using per diem pay through payroll, you’re likely paying more to the IRS than you need to.
Here’s what’s really happening:
The IRS allows you to pay drivers $80 a day tax-free to cover meals and daily expenses. If a driver is on the road 250 days a year, that’s $20,000 of their income that shouldn’t be taxed.
But if you’re not paying per diem through payroll, that $20,000 is treated like regular income. You pay full employer taxes on it, and the IRS takes more of your money.
When you pay drivers per diem correctly:
- You reduce your payroll tax liability.
- You lower your unemployment and workers’ comp exposure.
- You keep more money inside your company, where it belongs.
This isn’t just about helping your drivers take home more. This is about helping your business stay alive.
How Much Money You Lose Without Per Diem (With Real Numbers)
Let’s say one of your drivers is on the road 250 days a year. That’s:
- $80/day × 250 = $20,000 of income that could be tax-free.
If you skip per diem:
- You pay full employer taxes on all $20,000.
If you use per diem:
- You save around 7.65% in FICA taxes on that amount.
- That’s $1,530 saved per driver.
Now multiply that by 10 drivers: $15,300 back in your business — every year.
And that’s just one of the areas where you save.
Why Skipping Per Diem Makes Drivers Leave (and Hurts Your Reputation)
More drivers know about per diem now. Many are reading up and comparing companies.
If your drivers ask about it — and you don’t offer it — it may look like you’re cutting corners or don’t care about their paycheck.
That can lead to:
- Losing good drivers to other companies
- Lower driver satisfaction
- More turnover (and more hiring costs)
Even if your heart’s in the right place, skipping per diem sends the wrong message and can hurt driver retention.
What the IRS Takes When You Don’t Use Per Diem Payroll
Let’s be real — the IRS doesn’t care that freight rates are in the tank or that your company is barely breaking even.
They don’t care if you’re losing sleep over payroll. They don’t care that your profit margins are razor-thin.
If you’re not taking advantage of per diem, they’ll gladly take more of your money, week after week, driver after driver.
But it doesn’t have to be that way.
Per diem is:
- Legal — it’s 100% IRS-approved.
- Simple — when it’s set up the right way.
- Powerful — because it cuts your payroll taxes without cutting driver pay.
This isn’t a risky move or a financial trick. It’s a smart, compliant way to stop bleeding money and start protecting your business.
If you’re skipping per diem, you’re not saving money, you’re just giving it to the IRS.
Protect Your Payroll, Your Drivers, and Your Bottom Line
At the end of the day, skipping per diem payroll means giving more of your hard-earned money to the IRS — money you could be using to pay drivers, grow your business, or just stay afloat in a tough market.
If you’re like most trucking companies, you’re already struggling with high fuel costs, low freight rates, and rising insurance. Overpaying on payroll taxes just adds more pressure you don’t need.
Now that you understand how per diem works — and how much you could be saving — it’s time to take action. Don’t keep leaving money on the table.
At Superior Trucking Payroll Service, we help companies like yours set up per diem the right way, legally, simply, and without hassle. We know the rules. We’ll walk you through the setup, make sure you stay compliant, and help you start saving money every week.
We’re not just a payroll provider, we’re here to help trucking companies survive tough times and come out stronger. Visit our website to learn how per diem can protect your drivers, your payroll, and your bottom line.
Written by Melisa Bush
With over 15 years of experience in the trucking industry, Melisa is well-versed in the complexities of trucking payroll and adept at navigating special circumstances. Before joining Superior Trucking Payroll Service, Melisa worked at a trucking company, where she managed driver miles and expenses for a fleet of 50 trucks. This hands-on experience gives her unique insight into the challenges our clients face when preparing their payroll data.