Bad Tax Advice Owner-Operators Hear All the Time (And Why It Causes Problems)

If you’re an owner-operator, you don’t have to go far to find bad tax advice. It shows up at the fuel island, in Facebook groups, in carrier breakrooms, and from other drivers who mean well but are usually speaking from personal experience rather than actual tax rules.

Unfortunately, bad tax advice has a way of costing truck drivers real money, often months or years after it was followed. Below are six of the most common examples we hear every tax season and why they should not be ignored.

“Send your accountant all your food and drink receipts to write off.”

This is one of the fastest ways to spot advice that is outdated or just plain wrong.

Most owner-operators do not deduct actual food and beverage receipts anymore. Instead, they qualify for per diem, which allows eligible drivers to deduct a daily amount for meals while away from home overnight.

Per diem simplifies recordkeeping and, in many cases, results in a larger and cleaner deduction than trying to track individual meals. Sending in coffee receipts, fast food slips, or convenience store purchases does not increase your deduction and can actually create confusion if mixed incorrectly with per diem rules.

Per diem has specific qualifications, limits, and calculations. It is not the same as writing off every meal you buy on the road. Doing it correctly matters.

“If you didn’t get a 1099, you don’t have to report it.”

This one pops up every year, especially when documents are delayed or missing.

Income does not become non-taxable just because a form was not received. If money was earned through your trucking business, whether it came through settlements, direct deposits, or other payments, it generally must be reported.

The IRS looks at consistency between reported income and information they receive from carriers, brokers, and other sources. Missing income, even unintentionally, can result in notices, adjustments, or penalties later.

It is always better to report income accurately from the start than to explain missing pieces after the fact.

“I’ll just pay everything at tax time.”

Owner-operators are responsible for making quarterly estimated tax payments throughout the year. These payments help cover income tax and self-employment tax as you earn income, rather than waiting until tax time.

Skipping quarterly payments does not eliminate the tax bill. It simply delays it and often adds penalties and interest for underpayment. By the time tax season arrives, drivers can find themselves facing a much larger balance than expected, all due at once.

Quarterly payments are not about paying more. They are about spreading the liability out, improving cash flow planning, and avoiding unnecessary penalties.

“You should want to get a big tax refund.”

A big tax refund feels like a win, but for most owner-operators, it usually means you overpaid during the year.

Refunds happen when estimated tax payments are too high or when planning is off. That money could have been used all year to cover expenses, build a cash buffer, or invest back into the business. Instead, it sat with the IRS interest-free.

The goal is not to owe a surprise balance or chase the biggest refund possible. The goal is accuracy. Paying what you owe without penalties and keeping more of your cash working for you throughout the year.

If someone tells you a big refund means you did everything right, it is worth taking a second look.

“Setting up an S corp in your first year saves tons on taxes.”

This one sounds especially appealing to new owner-operators.

An S corporation can be the right move in certain situations, but it is not a guaranteed tax savings, and it is rarely a first-year solution for drivers.

S corporations come with additional requirements such as payroll, reasonable salary rules, added filings, and higher administrative costs. Without sufficient and consistent profit, the structure often adds complexity without delivering meaningful savings.

We frequently see drivers pushed into S corps too early based on generalized advice. Whether it makes sense depends on income level, long-term goals, and how the business is operating, not just the promise of saving on self-employment tax.

“I use tax software. Trucking taxes aren’t that different.”

Tax software can be a helpful tool, but it does not replace experience or industry-specific knowledge.

Owner-operator taxes include per diem, depreciation on equipment, estimated taxes, multi-state considerations, and business structures that affect how income is reported. Software will ask questions and generate a return, but it will not tell you whether you are making smart decisions for your business.

Many drivers come to us after filing on their own because something did not feel right or because the outcome was not what they expected. Filing is only one part of the process. Planning and understanding what the numbers mean is just as important.

The Bigger Picture

Most bad tax advice comes from someone sharing what worked for them, without accounting for differences in income, expenses, business setup, or timing.

Owner-operators are running real businesses, and their tax situation deserves more than shortcuts and assumptions. The goal is not to pay more tax than necessary, but it is also not to create problems that show up later when they are harder and more expensive to fix.

If you are hearing any of this advice and are unsure whether it applies to your situation, that is usually a sign it is time to slow down and ask questions.

If you are getting any of this bad tax advice, reach out to ATBS. We work with owner-operators every day to help make sure their tax strategy actually fits their business and supports them year after year.