Calculating Your Federal Income Taxes

Posted on: 31 August 2018

There are lots of different ways to be an independent delivery driver in today's economy. You can deliver groceries, food, medication, and all sorts of supplies as a delivery driver. If you just started as a delivery driver this year, make sure that you are keeping track of all of your business expenses so that you are able to claim as many deductions as possible.

Mileage

One of the biggest deductions that you can take when you are a delivery driver is mileage. The good thing about mileage is that it includes all driving that you do for work. That includes driving to the location to pick up the items that you will be delivering and driving the order to the delivery location. All the driving you do for work can be included in your mileage.

It is important to note that if you claim mileage, then you are not going to be able to deduct the amount of gas that you pay for. That is because the mileage allowance is designed to cover all car-related expenses, such as gas, maintenance, insurance, and depreciation. The mileage deduction is generally more generous than if you were to deduct all of your car-related expenses on their own.

Phone Service

You can't have a delivery service without a phone. If you have a dedicated work phone, you can deduct the fee that you pay for service for the year. You can also deduct any accessories that you purchased for your phone that were necessary for your job, such as a car charger or a phone holder.

If you use your personal phone for work, you need to figure out what percentage of your phone use is for work and what percentage is for personal use. Then you can deduct that percentage of your phone expenses.

Parking & Tolls

One car-related expense that is separate from gas is parking. If you have to pay for parking at all, make sure that you write down each time you drop coins in the meter, swipe your card, or purchase a parking pass for work.

You can also deduct the cost of tolls. If you have a toll card, you can deduct that. Once again, you can only deduct tolls that are related to driving that you do for work.

Roadside Assistance

When you spend your time out on the road, roadside assistance is another vehicle-related expense that is not covered by the mileage allowance. As a delivery driver, it is smart to have a roadside assistance plan, as staying on the road is important for your business.

Insulated Bags & Blankets

If you are transporting food or items that you need to keep cold or hot, you are going to need to invest in insulated blankets or bags to keep the food in good shape while you are transporting it. Supplies that you need to assist with your delivery business and deliver quality products are business expenses that you can deduct from your income.

Health Insurance

If you are completely self-employed, and you pay for your own health insurance, the amount that you pay out of pocket for your insurance is deductible.

Consult with a tax accountant to find out what other expenses you should be keeping track of so that you can make all possible deductions come tax time. You want your income to reflect what you actually earn after all of your expenses. To learn more, talk to companies like 5 Star Tax.