We’re almost a month into the New Year and a lot has already happened that’s impacted the Trucking Industry. From intense Blizzards to ELD Mandate Strikes, Raney’s is here to shed some light on what you need to know about 2018 to help make sure you’re prepared to make the most out of the New Year. After some research, we’re ready to present you with our Top 5 Things You Need to Know about in 2018.
1. Tax Breaks
With new the Tax legislation, the Tax Cuts and Job Act (TCJA), now signed into effect there are some notable differences/benefits available for truckers. The one that seems to be generating the most buzz is the elimination of the Per Diem Rates, which granted Truckers $63/day for on-the-road meal costs. However, this isn’t completely negative, as there’s a special provision that has been left in place that allows for those that are subject to Hours of Service (HOS) to deduct 80% percent of the per diem rate from their taxes.
The new Tax Plan initiated other radical changes, as well. Standard Deductions have now been significantly increased, doubling for those filing jointly-married and almost doubling for those filing Single. Since truckers may only choose between standard or itemized deductions, how you figure out your taxes is going to depend on how you’re filing them—for example, Single vs. Married. Other tax changes include an increase to the Child Tax Credit and slight cuts to the amount taxed in some brackets. How you file your taxes this year will be incredibly important, potentially saving you thousands of dollars.
Want more ways to optimize your tax return? You can read our blog post about Tax Deductions that every Trucker should be taking advantage of, here.
There’s been a lot of buzz surrounding the usage of Blockchains in the Trucking Industry, and with all that buzz, are lots of people wondering just exactly what a Blockchain is or means. To put simply, a block is record and a blockchain is a collection of those records. So, in the trucking industry, this could include information like Geofence-tracking and performance history. Once this information is recorded, that block is then added to the chain. As you may have figured out, a blockchain’s information would all be shared within a particular online system, allowing for enhanced visibility and security.
In short, Blockchains could greatly speed up, or even automate, many aspects of Freight. Plus, blockchain would give smaller Owner-Operators opportunities to emerge in new markets to gain business that they may have otherwise missed out on. You can find more information about Blockchain, or join the alliance, at Blockchain in Transport Alliance (BiTA). UPS recently joined BiTA in November of last year.
3. Trucker Pay
The New Year has primed itself to be a good year for Trucker Wages. A combination of factors, such as the corporate tax cut from 35% to 20%, ELD Mandates driving some Long-Term Truckers to leave the Industry, an increase in Freight demand and rates, and the difficulty of finding new Trucker’s to fill the positions left by aging drivers have many analysts believing that wage increases will happen sooner rather than later. Not to mention Driver Pay hasn’t kept up with inflation. If going to back to the year just before deregulation, data would prove that Trucker wages are approximately half of what they would’ve been in ’79, after accounting for inflation.
Trucking obviously isn’t for everyone, but for those select few who don’t shy away from physically demanding work may find themselves in position to earn a decent living.
4. The Future of The Trucking Industry
An entire blog post could be written about this section here, but for the sake of brevity, I will highlight things we all need to keep an eye on throughout the year:
- Regulations have hindered the Trucking’s Industry ability to hire qualified candidates to meet the demands of explosive growth. This has been intensified by automation’s relatively slow development. Eventually, something is going to have to give.
- With E-Commerce business platforms gaining more traction versus their Brick & Mortar counterparts, the ability for logistics to deliver under E-commerce’s rigid structure is still a question mark. How will the increased demand be fulfilled? Will it be by Vans, Drones, Planes, or Trucks?
- Electronic vehicles are coming, but their efficacy in an industry that demands long hours on the road is still questionable. Tesla’s Semi Truck generated a lot of buzz these past couple of months, boasting autonomous driving capability and an audacious 1-million-mile guarantee from breakdowns. However, their limited range (300 miles or 500 miles, depending on the model) and lengthy 10-hour charge time leaves many questions about their immediate application. What’re your thoughts on Electric/Automated Big Rigs? Let us know in the comments below!
- Lastly, Technology is rapidly evolving Trucking. The ELD Mandate may just be the initial leak in the regulatory dam for an industry that is prime for Big Data to flood. By implementing Biometric monitoring and Geo-Tracking, technology—and the data collected from it—has the opportunity to improve many areas in Trucking, like safety and employment to name a few. But the question then becomes: At What Cost to a Trucker’s Freedom and Privacy?
The firestorm that has become the ELD Mandate continues to rage on, consuming the attention of many in the Industry. As right now, the Mandate still remains in effect with Trucker’s begrudgingly complying to DOT’s newest regulation, except for a select few exceptions—if you are curious about your eligibility for exemption, GeoTab has a great resource which can be found here. The mandate has made many long-time Trucker’s abandon their seat behind the wheel in protest, a move that is sure to impact an industry desperate to meet the demand for freight. The mandate has also brought legal action from OOIDA, whom appealed to the Supreme Court before being denied hearing, and an anti-ELD amendment proposed in H.R. 3354 by Representative Brian Babin (R-TX). The amendment, which would’ve prevented funding to enforce the ELD mandate, was voted down in the House 246-to-173.
If you’re in strict opposition of using ELDs, you still have some time before you must use an ELD. As directed in MAP-21, Phase-2: Phased-In Compliance Phase, allows for a two-year period from the Compliance Date (December 18, 2017) to use either an AOBRD or an ELD. If you’re curious what the difference between the two are, an AOBRD is similar to an ELD except it records and transmits less data than an ELD. However, if no legislation has been proposed to amend the regulations laid out in MAP-21, then by December 16, 2019 you must switch to an ELD.
Personally, I would not recommend this course of action because come December 16, 2019 you will have to switch from an AOBRD to an ELD; thus, by using an AOBRD you’re simply costing yourself more money to delay the inevitable.