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  #11  
Old 11-23-2007, 04:12 PM
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Quote:
Originally Posted by no_worries
But hey, that's just one opinion :lol:
two opinions. :wink:

I completely agree.
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  #12  
Old 11-23-2007, 05:15 PM
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Quote:
Originally Posted by Rev.Vassago
H&R Block knows NOTHING about the trucking-related deductions.
JEZZUSS,Rev stop it! I completely agree......again 8)
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  #13  
Old 11-23-2007, 06:00 PM
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Quote:
Originally Posted by mike3fan
Quote:
Originally Posted by Rev.Vassago
H&R Block knows NOTHING about the trucking-related deductions.
JEZZUSS,Rev stop it! I completely agree......again 8)
I'm sorry. I'll try to be more conflicting in the future.
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  #14  
Old 11-23-2007, 06:35 PM
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Quote:
Originally Posted by no_worries
GMAN, hate to disagree but I can't see how you'd ever have less tax liability being paid on a 1099. At a bare minimum your liability would be exactly the same as your income is what it is no matter how you're paid. Most likely you'd owe more since your liable for self-employment tax. It is true that your withholdings will be less, but just because you're having less withheld does not mean you're paying less in taxes.

I agree with Rev on the H&R Block. There reputation is far from sterling when it comes to tax prep. That's not to say there aren't individual offices that do a good job, but the company-wide rep isn't great among those in the know. With anything other than a basic 1040 I'd go to a CPA unless you're knowledgeable enough yourself to monitor a tax prep's work.

But hey, that's just one opinion :lol:

I have used a corporate structure most of my life, so my situation is different. However, as I recall if you report the 1099 income as wages, then it may be necessary to pay self employment tax on the entire amount. If it is reported as business income or other income then you may not have to pay the self employment tax or may only have to pay the tax on the net after deductions. Income tax is payable on the net after deductions. Since I am not a tax professional I recommend you consult with one. Everyone is different. I don't want to pay these people any more money than is absolutely necessary. In any case, that is what I was referring. If I remember correctly you only pay self employment tax on wages.

As far as H & R Block is concerned, I have never used them. However, I know a small fleet owner who has used them for years. Apparently, he is pretty satisfied with them. Personally, I prefer a CPA. There are some good public accountants who work with trucking companies. I know of one locally who works with them and is highly regarded. In fact, he works with one carrier who has about 100 trucks. I think it is a matter of finding someone who is familiar with this industry, regardless of what they have behind their name. However, an individual's taxes should not be that difficult for most people who regularly do taxes. There are tax software packages that are supposed to be good. From what I understand, all you need do is plug in the numbers. It asks questions, you answer and the software does the rest.

The IRS has a website where you can get forms and instructions for about everything. I believe it is www.irsforms.com? You may find the answer you seek on their website.
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  #15  
Old 11-23-2007, 07:27 PM
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You only pay Self Employment tax if there is over $400 profit. It's form SE.

You also get to write off 50% of the tax. Look at the form. It goes on line 27 on the form 1040.

If you have a 1099, you fill out the Schedule C. Transfer that amount ( profit or loss) to line 12 on the form 1040.

You can also write off 50% of your health insurance premium.
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  #16  
Old 11-23-2007, 11:07 PM
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Thanks for clearing that up, Bigmon.
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  #17  
Old 11-23-2007, 11:32 PM
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But this wouldn't be self employment in this case, it is a company scamming the driver into paying their share of taxes. I highly doubt anyone in this situation would have enough legitimate deductions to wipe out any taxes due. If the 1099 recipient were an O/O responsible for all the truck expenses, yes, an employee getting an illegal 1099, no.
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  #18  
Old 11-24-2007, 12:14 AM
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I don't see what is illegal about him getting a 1099. He can be considered an independent contractor. The IRS allows drivers to legally be considered an independent contractor. There is a fine line with drivers and certain criteria must be met. Some may be considered independent contractors while others may not. He evidently agreed to be paid as an independent contractor or the company would not have issued one. In any case, all the poster asked was how to declare the 1099 income.
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  #19  
Old 11-24-2007, 12:36 AM
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Kevin Rutherford talks a lot about this. He has his own show "trucking business and beyond" on xm 171.

Basically what he says is that if there is NO risk to the driver, and he does not own any equipment, he is a company driver not an independent contractor. The IRS is coming down hard on this. The IRS and several states(37 or so) also made an agreement where they're going to "share" information regarding this. So if the IRS finds out, expect the state to be not too far behind and vice versa.

This guy knows what he's talking about, he's done thousands of tax returns for truckers. That's basically all he does.

I would recommend your friend call Kevin during the show.

303-302-1234

His show is live mon-wed 11 pm CST for an hour. Repeats thursday and friday nights. 3-6 sat and sun CST.

Tell him to call right at the beginning, or even a little before the beginning of the show.

He will get the EXACT answer that he needs.
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  #20  
Old 11-24-2007, 01:04 AM
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I spoke with the IRS myself about this a couple of years ago. According to what I was told, it doesn't have anything to do with whether the driver owns the equipment. It has to do with control. If the driver can decide where, when and how he does his job, what loads he takes, then he can be considered an independent contractor because he has control. If the driver is under forced dispatch and doesn't have any control over where or when he does his job, then he is considered an employee. If you stop to think about it, that makes sense. I don't think this guy really cares. He just wants to make sure how to file his taxes. I don't think he is seeking someone to inform the Gestapo (IRS). Perhaps this is the main reason so many carriers encourage the fleece purchase deals. :?
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