In short

Trucking payroll pays drivers by the mile, by load percentage or by the hour, often with per diem, detention pay and safety bonuses on top. The work includes setting up each pay type correctly, deciding whether drivers are employees or leased owner-operators, withholding and depositing federal employment taxes, quarterly Form 941 filings, year-end W-2s and Form 1099 reporting for qualifying owner-operator payments.

Driver pay types

Drivers may be paid per mile, a percentage of load revenue, hourly for local routes, or a combination with detention, layover and stop pay. Each type is set up as its own earning in payroll so the register shows what drove each paycheck.

Employees or leased owner-operators

Company drivers are usually employees; owner-operators who lease their own truck to a carrier are often treated as independent contractors. The classification depends on the facts, and the IRS describes the factors on its independent contractor or employee page. We review each relationship before choosing W-2 or 1099 reporting.

Per diem for drivers

Some carriers pay drivers a per diem for travel away from home. Whether it is excluded from wages depends on how the plan is structured; the IRS explains accountable plans and travel rules in Publication 463 and Publication 15. We set up per diem as a separate pay item so its treatment is clear.

Overtime

Many interstate drivers fall under a motor carrier exemption from federal overtime, while local or non-exempt drivers do not. The Fair Labor Standards Act rules are applied per driver, not per company.

Filings

Deposits and Form 941 filings are reconciled to the payroll register quarterly, and W-2s and 1099s are checked before they are issued.

Key terms

Definitions for terms used on this page:

  • Payroll Register: A payroll register is a report listing each employee's earnings, deductions and net pay for a payroll period.

Trucking & Transportation problems this addresses

  • Factoring companies advance cash net of fees and reserves
  • Fuel is the largest variable cost and is paid with several cards
  • Driver settlements combine pay, advances and deductions
  • Trucks and trailers are expensive assets with loans attached
  • Heavy highway vehicle and fuel tax records must be kept by vehicle