Can OTR Truckers Deduct Meal Expenses on Their Taxes?

Over-the-road truckers subject to Department of Transportation hours-of-service rules get a more favorable meal deduction than most taxpayers. Instead of tracking actual meal costs, they can use a per diem rate set by the IRS, and the deductible percentage is higher than the standard 50% limit that applies to most business meals. The rules differ depending on how the trucker is set up - Schedule C sole proprietor, W-2 employee, or owner-operator running under an S corporation - and that structure affects both how the deduction is claimed and what benefit it actually delivers.

Why OTR Truckers Get Special Treatment

IRC Section 274(n) limits most business meal deductions to 50% of the actual cost. Congress carved out an exception for workers subject to Department of Transportation (DOT) hours-of-service regulations - which includes over-the-road truckers operating commercial motor vehicles in interstate commerce. Those workers can deduct 80% of their meal costs instead of 50%.

The rationale is straightforward: truckers on long hauls cannot eat at home. The elevated deduction percentage acknowledges that meals away from home are a genuine cost of doing the work, not a lifestyle choice.

Per Diem Instead of Receipts

Tracking every meal receipt on the road is impractical. The IRS allows DOT-regulated workers to use a standard meal and incidental expenses (M&IE) per diem rate instead of substantiating actual costs. The applicable rate is the federal per diem for travel within the continental United States (CONUS), with higher rates for certain localities and for travel outside the continental US (OCONUS).

The IRS updates these rates annually, typically in the fall before the new tax year. Confirm the current rate on IRS.gov or in Publication 463 before applying a specific number.

The 80% deductibility limit still applies to the per diem amount. The per diem replaces the need to keep meal receipts - it does not change the applicable percentage.

How Structure Determines the Actual Benefit

The 80% rate is the same regardless of how a trucker is set up. What changes is where the deduction gets claimed, whether it reduces self-employment tax, and whether it is available at all under current law.

Schedule C - Sole Proprietor Owner-Operator

A self-employed OTR trucker filing Schedule C deducts 80% of either actual meal costs or the applicable per diem directly on that schedule. This reduces both income tax and self-employment tax, which makes the deduction comparatively valuable. The trucker claims it directly - no employer involvement required.

W-2 Employee Truckers

The picture is more complicated for employees. Before the Tax Cuts and Jobs Act (TCJA), employees could deduct unreimbursed business expenses - including meals - as a miscellaneous itemized deduction subject to the 2% AGI floor. TCJA suspended that deduction entirely for tax years 2018 through 2025. As currently scheduled it returns in 2026, but Congress could extend the suspension.

For employee truckers, the practical path to capturing the meal deduction is through an employer-operated accountable plan that reimburses per diem. A reimbursement under a properly structured accountable plan is excluded from the employee's wages - the employer gets the 80% deduction, and the employee receives the economic benefit without it appearing as taxable income.

Employee truckers whose employers do not offer per diem reimbursement currently have limited options under the TCJA suspension.

Owner-Operators Running Under an S Corporation

This is where the structure creates a meaningful trap. An owner-operator who has elected S corporation status is typically a shareholder-employee - meaning they receive W-2 wages from their own S corp. That classification matters here.

Because the trucker is an employee of the S corp, the same TCJA problem applies: unreimbursed meal expenses are not currently deductible at the individual level. The S corporation itself can deduct 80% of meal costs it pays or reimburses, but only if those reimbursements flow through a properly structured accountable plan. If the trucker simply pays meals out of pocket and does not run them through the S corp under an accountable plan, the deduction is lost under current law.

The fix is the same as for any W-2 employee: the S corporation adopts an accountable plan, reimburses the shareholder-employee for documented travel meals at or below the federal per diem rate, and takes the 80% deduction at the entity level. The reimbursement is excluded from the employee's W-2 wages. Without that structure, the S corp election can inadvertently eliminate a deduction that a Schedule C filer would have claimed without any additional steps.

Accountable Plan Requirements (expand for detail)

For a per diem reimbursement to be excluded from an employee's wages, the arrangement must satisfy the accountable plan rules under IRC Section 62(c) and the related Treasury regulations. The core requirements are:

The expense must have a business connection - the travel must be away from home and required by the employer's business.
The employee must substantiate the time, place, and business purpose of the travel within a reasonable period.
Any excess reimbursement must be returned to the employer within a reasonable period.

Per diem arrangements satisfy the substantiation requirement as long as the amount paid does not exceed the federal rate. Amounts paid above the federal rate are treated as wages for the excess portion.

The "Tax Home" Requirement

The meal deduction - whether actual cost or per diem - only applies when the trucker is away from their tax home overnight. A trucker whose regular run returns them home each night is not "away from home" under IRC Section 162(a)(2) and cannot claim the deduction for those days, regardless of hours driven.

For truckers without a fixed home base or who are on the road for extended periods, determining what constitutes a tax home can be a contested issue. The IRS and courts look at where the taxpayer has a regular place of business, where they maintain a permanent residence, and where they spend the most time. A trucker who cannot establish a tax home may find the deduction disallowed entirely.

Recordkeeping

Using the per diem rate reduces the recordkeeping burden but does not eliminate it. Truckers still need to document:

The dates of travel away from home
The destination or general area of travel
The business purpose of the trip

DOT-required logbooks often satisfy much of this requirement, which is a practical advantage OTR truckers have over other traveling workers. For S corp owner-operators, that documentation also needs to feed into the accountable plan reimbursement process - the logbook alone does not substitute for the plan itself.