How Much Is Per Diem for Truck Drivers: IRS Rates and Rules

Per diem for truck drivers is $80 per day for travel inside the continental United States and $86 per day for travel outside it, effective October 1, 2025 through September 30, 2026, under IRS Notice 2025-54.¹ The incidental-expenses-only rate is $5 per day. These figures cover meals and incidentals, and they apply as flat amounts regardless of which city or county the driver stops in. Whether the money reaches you tax-free, and whether you can deduct anything at all, depends on how you’re paid and how the trip is documented.

Who Qualifies for Tax-Free Per Diem

Three conditions have to line up before per diem payments can be excluded from taxable income.

A Tax Home

The IRS defines a tax home as the entire city or general area where the driver’s main place of business is located.² In practice, that means maintaining a residence with real living costs — rent or mortgage, utilities, the rest of it. A driver who has no fixed home and sleeps in the cab full-time may be treated as having no tax home at all, which disqualifies them from per diem entirely.

Sleep or Rest

The trip has to be long enough that you need genuine sleep or rest. Same-day out-and-back runs don’t qualify, no matter how many miles they cover. The IRS uses a truck driver in its own example: leaving a terminal and returning the same day with only a short meal break at the turnaround point is not travel away from home.² A short nap in the cab won’t satisfy the rule either.

Temporary Assignment (the One-Year Rule)

An assignment at a single location has to be realistically expected to last one year or less. If it’s expected to run longer, that location becomes the driver’s new tax home and per diem for travel there stops being deductible or excludable.² Long-haul drivers who change routes constantly rarely trip over this, but drivers on a dedicated lane or extended contract haul to one facility can. The test is realistic expectation at the start of the assignment, not hindsight.

How the Daily Amount Is Calculated

Travel Days Get 75 Percent

On the first and last day of a trip, you get 75 percent of the applicable rate, not the full amount.² At the current $80 CONUS rate, that’s $60 on the departure day and $60 on the return day, with $80 for every full day in between. Any other consistent method that reflects reasonable business practice is allowed, but the three-fourths method is standard because it’s simple.

What “Incidental Expenses” Covers

The incidental portion is narrower than most drivers assume. It covers fees and tips given to porters, baggage carriers, and hotel staff.² Laundry, phone calls, transportation between lodging and restaurants, and mailing costs are not part of it. Those are separate expenses.

Flat Daily Rate or Cents-Per-Mile

Carriers distribute per diem two common ways. The straightforward version pays a flat daily amount tied to the IRS rate. The alternative converts the daily allowance into a cents-per-mile figure, typically somewhere between $0.10 and $0.16 per mile depending on expected daily mileage. Either way, the total per diem paid for any single day cannot exceed the federal limit. On a high-mileage day under the cents-per-mile method, the carrier caps the payout at the daily maximum.

Standard Rate or Actual Cost

You aren’t locked into the standard rate. The IRS also allows the actual cost method, where you track and deduct every meal receipt individually.² Few drivers bother, because saving a year of restaurant receipts is tedious and the standard rate usually comes out better. One catch: if you use the special transportation industry rate for any trip during the year, you must use it for every trip that year. No cherry-picking.

Company Drivers: Accountable Plan or It’s Wages

Per diem is only tax-free when the employer’s arrangement meets the IRS definition of an accountable plan. All three conditions have to be satisfied:²

Business connection. The expenses must be incurred while performing services as an employee, specifically travel away from the driver’s tax home.
Adequate accounting. The driver must give the employer records showing the date, location, and business purpose of each trip within a reasonable period.
Return of excess. If the employer pays more than the substantiated amount, the driver must return the difference within a reasonable time.

When any of these fails, the whole payment becomes taxable wages. The IRS says as much directly: if no expense report is filed, if the report lacks required details, if a flat amount is paid with no accounting required, or if per diem exceeds the federal rate, the payments are treated as wages and employment taxes are due.³ Recharacterizing existing wages as nontaxable reimbursements — cutting base pay by exactly the per diem amount and calling the difference a reimbursement — does not satisfy accountable plan requirements.⁴ Per diem has to be a genuine additional allowance for road expenses.

If Your Carrier Doesn’t Offer a Per Diem Program

Here’s where many company drivers get caught out. If your carrier has no per diem program, you can’t deduct meal expenses on your own return. The Tax Cuts and Jobs Act eliminated the deduction for unreimbursed employee business expenses starting in 2018. Before then, W-2 drivers could claim unreimbursed per diem on Form 2106 as a miscellaneous itemized deduction. That option is gone.

That makes per diem part of compensation, not a perk. A driver receiving $80 per day in tax-free per diem over 250 qualifying days keeps $20,000 that would otherwise be taxed as wages. At a combined federal and state marginal rate of 22 to 30 percent, that’s roughly $4,400 to $6,000 in annual tax savings. When comparing two carriers with similar base pay, one with a per diem program and one without, the difference is real money.

Owner-Operators and Independent Contractors

Owner-operators don’t receive per diem from an employer. They deduct meal expenses directly on Schedule C (Form 1040), reporting deductible meals on line 24b.² They can use the same special transportation industry rate of $80 per day (CONUS) or $86 per day (OCONUS) instead of tracking actual receipts.¹

The important detail: owner-operators can deduct 80 percent of meal expenses, not the full amount. This higher rate applies to workers subject to the Department of Transportation’s hours-of-service limits, which covers interstate truck drivers.² Most other business travelers are limited to 50 percent. Using the $80 daily rate, an owner-operator deducts $64 per full travel day. Over 300 driving days, that’s $19,200 in deductions, which reduces self-employment tax as well as income tax.

The Trade-Offs of Taking Per Diem

Lower Reported W-2 Wages

Properly structured per diem doesn’t appear as wages in Box 1 of the W-2.² A driver earning $70,000 in base pay plus $20,000 in per diem shows only $70,000 in taxable wages. That’s the point, but it has consequences anywhere reported income matters.

Social Security Credits

Social Security retirement benefits are calculated on a worker’s highest 35 years of reported earnings. Per diem isn’t reported as wages, so it doesn’t count toward those earnings.³ A driver receiving $20,000 per year in per diem over a 20-year career will have roughly $400,000 less in lifetime reported earnings than a driver paid the same total as straight wages. Whether the current tax savings outweigh the future benefit reduction depends on age, total career earnings, and how close retirement is. Drivers within 10 to 15 years of retirement should pull their Social Security statement and run the numbers.

Mortgage and Loan Qualification

Lenders use reported taxable income for debt-to-income calculations. Per diem reimbursements generally don’t count as qualifying income because they’re classified as expense reimbursements. A driver with $70,000 in W-2 wages qualifies for a smaller loan than one showing $90,000, even if actual total compensation is identical. Some loan programs may add per diem back with specific documentation, but don’t count on it. Some drivers temporarily opt out of per diem for a year or two before applying for a major loan so reported income reflects full compensation.

Records to Keep

Using the standard rate removes the need for individual meal receipts, but the IRS still wants proof of when, where, and why you traveled. For company drivers, that means trip records showing departure dates, return dates, and destinations. Electronic logging devices, required by the FMCSA on most commercial motor vehicles, automatically record driving time, vehicle location, and miles driven, and they serve as natural supporting documentation.⁵

Owner-operators should keep ELD printouts, dispatch records, and fuel receipts that corroborate travel dates and locations. A simple log noting each day away from your tax home, where you stopped, and the business purpose is the minimum. The IRS can generally audit returns filed within the past three years, or six if there’s a substantial understatement of income, so hold onto travel records at least that long. Digital copies are fine as long as they’re legible and accessible.

The IRS updates the special transportation rates each fall, so watch for a new notice each year. The prior figures under Notice 2023-68 were $69 (CONUS) and $74 (OCONUS); any carrier or owner-operator still using those numbers is underpaying by $11 per day domestically.

1
IRS. 2025-2026 Special Per Diem Rates (Notice 2025-54)
2
Internal Revenue Service. Publication 463 (2025), Travel, Gift, and Car Expenses
3
Internal Revenue Service. Per Diem Payments Frequently Asked Questions
4
Internal Revenue Service. Internal Revenue Bulletin 2012-37
5
FMCSA. ELD Fact Sheet – English Version