COTC Partners with Washington FederalNov 15, 2017
Financial wealth includes access to the maximum credit at the lowest interest rates. Making the most money possible paid on steady, reliable weekly paychecks is essential to building wealth.
As a truck driver in America you should not be held back from buying the home your family needs because you are enrolled in a truck driver per diem plan. Truck driver per diem plans allow up to $68 dollars a day in per diem for each night away from home. Truck drivers are lucky in that they are included in the IRS definition of transportation worker per diem, IRS Revenue Procedure 2011-47, whereby your per diem is considered wages; but taxed as an expense reimbursement. Meaning, it counts as earnings and should increase your available credit, while also increasing your net take home. Per diem it is not taxable for Federal and State Income Taxes. One of those rare examples where the truck driver comes out ahead!
Paul Coil, the Chief Financial Officer of Central Oregon Truck Company, met with the executive team of Washington Federal Bank to partner with them on half of COTC drivers regarding the US Tax Code as it relates to per diem and driver compensation. Mr. Coil states,
One of the often cited issues drivers have had with participating in the per diem plan is that the compensation you receive as per diem is omitted from Boxes 1, 3, & 5 of your W-2, therefore most banks won’t recognize the per diem as legitimate on-going compensation. This is directly related to an FHA guideline that stipulates that mortgages to be sold in the secondary market seeking FHA protection can only rely on income that shows up in these boxes on the W-2.
There are, however, lenders like Washington Federal that are “portfolio lenders”, which means they keep all their loans on their books, so these FHA guidelines don’t apply to them. Having provided the leadership at Washington Federal with the specifics of the tax code as it relates to drivers, they are now convinced of the legitimacy of our drivers’ per diem as an on-going, reliable compensation for consideration when making home loan decisions.
Learn More about how Washington Federal supports COTC drivers and take advantage of another one of the many benefits of employment at COTC. We also have a Washington Federal customer service representative standing by at the Redmond, Oregon branch to answer any questions. If you do not reside in a state with a Washington Federal branch location and are thinking about a home purchase Mr. Coil recommends lenders that are “portfolio lenders” who have much greater flexibility in considering per diem compensation.
Understanding truck driver per diem is even more important with the changes to the tax code for 2018. You do not have to lose the tax benefits of per diem Read More.