WASHINGTON — President Trump is expected to sign into law a giant tax and spending cuts package approved by Congress on Thursday that includes tax breaks that could significantly boost trucking industry investment.
H.R. 1, nicknamed the One Big Beautiful Bill Act but opposed unanimously by Democrats, passed narrowly along party lines after a record-breaking floor speech by House Minority Leader Hakeem Jeffries, D-N.Y., that delayed the vote on the bill for almost nine hours.
Chief among the tax provisions that are expected to help trucking companies grow their business is a permanent extension and enhancement of the 20% deduction for Qualified Business Income (QBI), a provision that was part of the Trump 2017 tax cuts set to expire at the end of this year.
The QBI deduction allows trucking companies and other businesses that are set up as sole proprietorships, partnerships, and S corporations avoid being placed at a tax disadvantage relative to large corporations.
The new QBI provision expands eligibility for the deduction and gives businesses with certain QBI levels an inflation-adjusted minimum deduction of $400.
Congress also reinstated 100% bonus depreciation that now applies to qualified assets acquired after January 19, 2025, and placed in service before January 1, 2030 (2031, in some cases). The provision will allow small-business truckers to immediately deduct the full cost of those assets, a tax benefit that encourages investing in new trucks and equipment.
Truck drivers could also see more take-home pay now that Congress has made permanent the individual income tax rates that were also part of the 2017 tax cut package, along with an increase in the standard deduction.
A permanent extension and increase of the Estate Tax Exemption is considered another benefit for family-owned trucking companies by providing more certainty for business planning and succession.
The legislation also makes it easier for new truck drivers to obtain a CDL by expanding education savings plans to cover expenses for truck driver training.
The American Trucking Associations supported the legislation as it moved through Congress.
“Motor carriers, the overwhelming majority of which are small businesses that operate ten trucks or fewer, will now have the ability to plan for the future, continue to provide good-paying jobs, and upgrade equipment,” commented ATA President Chris Spear in a statement.
“We commend congressional leaders for recognizing this fact and crafting this tax relief package that supports the 8.5 million Americans who work throughout trucking.”
Truckers blocked from overtime pay exemption
The Owner-Operator Independent Drivers Association, representing small-business truckers, was not as supportive. OOIDA had opposed several provisions that had been included in the initial version of the bill, including a $100 annual fee to access a new website to be created by FMCSA that would provide motor carrier fitness data. The provision was subsequently stripped out.
OOIDA also noted that truck drivers who are voluntarily paid overtime by their employers will not be able to take advantage of the bill’s much-hyped “no tax on overtime pay” provision – which survived the final version of the bill – because only workers who are required by law to be paid overtime are eligible. The trucking industry is exempt from the overtime pay requirement.
“Unfortunately, truckers won’t benefit from this key provision in the One Big Beautiful Bill,” said OOIDA President Todd Spencer in a statement.
“It’s time for Congress to fix a nearly century-old oversight by passing the bipartisan GOT Truckers Act and ensure truckers are eligible for both overtime pay and the tax relief extended to other blue collar workers.”
Related articles:
Click for more FreightWaves articles by John Gallagher.
