Truck Driving Jobs

henboy1 · Joined: 11 Nov 2006 Posts: 131

I am about to file my taxes with a CPA tomorrow.He claims he does O/O on a frequent basis.
In being a novice at this, I asked him if there was a way to even out my expenses and gross where I wouldn't owe anything or expect a return.He said no because that may trigger an audit.
As you know I don't know much about it.The CPA told me to add up my expenses, and on paper my expenses is as follows:
40%= fuel(includes deadhead)
base plate,local registration,2290=$2200
Repairs and Maintainance=$8000
per diem=$30/day X200 working days=$6000
Cell phone and aircard service=$1300
equipment for business=$1500
insurance=$50(bobtail and HCP)x 52 weeks=$2600

This was for last year.Let's say, the total expenses in running this bsusiness is 75% of my gross which is kind of saying 75cpm to operate.Let's say I grossed 100k and my expenses was 75k, does it mean I will pay 20-33% of the remainder which comes out to 25k X 20-33%?
This truck is paid off with no truck note.I have a company trailer.This is my second year in being an O/O.
BTW, where is my buddy CAM and the very fiery LOADIT?

BanditsCousin · Joined: 05 Jun 2004 Posts: 3195 Location: Chicago, IL

If you make under 31,000 I believe you are in the 15% tax bracket. Over 31,000 (net) is at 25%.

Luckily, I only made 24K last year when all was said and done :cry:

:lol: :lol: :lol: :lol: :lol: :lol:

henboy1 · Joined: 11 Nov 2006 Posts: 131

Let me play dumb.Do you mean net as in what you bring home after just fuel or net as in what you bring home after taking out fuel and all those expenses I mentioned above?Please bare with me.

Bigmon · Joined: 13 Jan 2006 Posts: 686 Location: S. Cal.

Henboy,

Don't forget this is the business part of your tax return. You still have the personal side. If you own a house that will take a big bite. You also have a personal deduction which is about 3600 for you and another 3600 if you're married. I don't have a tax form in front of me for the exact figures. You should also do an IRA.

trinitron · Joined: 21 Sep 2007 Posts: 29

Don't forget depreciation.

henboy1 · Joined: 11 Nov 2006 Posts: 131

How will I calculate depreciation on my truck?I only have about 15k left over after I subtract the gross from the expense/cost to operate.

BanditsCousin · Joined: 05 Jun 2004 Posts: 3195 Location: Chicago, IL

henboy1 wrote: How will I calculate depreciation on my truck?I only have about 15k left over after I subtract the gross from the expense/cost to operate.

You can't subtract the gross from expenses. Its the reverse. Gross is your 1099.

What meant from net (in above post) is what I pay tax on- ie: deduct fuel, repair, cell phone, scales, tolls, meal allowance, uniform, labor/lumper,etc

How much you owe on your truck will help you determin how much to depreciate it out. If you have 15K left after all expenses that you'll be taxed on, then you can possibly depreciate the truck 15K and not pay any tax this year.

henboy1 · Joined: 11 Nov 2006 Posts: 131

I am still learning new things on here.I finally went to this CPA and he asked for more expenses than I had on paper.Some opf the things I missed where
Parking,Tolls,truck wash and trailer lease.Supplies came under what I had listed as equipment to run the business.The difference when I subtract the gross, came out to $8500 and change.Now, remember that I HAVE NO TRUCK NOTE and so my truck depreciation will be minimal as someone with a truck note.I am realising people with truck notes come off better than someone without one.He said I owed $835 to IRS and $35 to the state.I have until april to pay this amount.
I know many CPAs or tax guys do many shady things to even out their gross and expenses but an audit may be right around the corner.

These are the fees I am expecting to pay:
April -taxes, $835 and $35
July-2290 $550
October -IRP $1400
Georgia Advolorean tax in October- $120
He adviced me of protecting myself by getting an incorporation and an LLC.My settlements will go to the business name and then I will cut a check to myself from that business account.This includes getting an FEIN # and not using my SS#.After getting an LLC/incorporation I will pay my taxes quarterly.Ouch!Too much to do.

Rev.Vassago · Joined: 04 Apr 2006 Posts: 5197 Location: Green Bay, WI

henboy1 wrote:
He advices me of protecting myself by getting an incorporation and an LLC.My settlements will go to the business name and then I will cut a check to myself from that business account.

How exactly does that protect you, and from what?

Heavy Duty · Joined: 04 Sep 2007 Posts: 79

The only reason for a LLC is so you CPA can charge you more for tax returns.

Until you get a good understanding of business taxes you may need to go with a trucking tax professional. There are many do a google search, Landstar supports one of them.

Quote: He said I owed $835 to IRS and $35 to the state.I have until april to pay this amount.

Truth is you ain't making any money, simple fact make money pay taxes, people that zero out every year aren't making real money.(go ahead and bash away)

no_worries · Joined: 18 Apr 2006 Posts: 834

You're supposed to be paying quarterly now, whether you're an LLC, corporation or whatever.

henboy1 · Joined: 11 Nov 2006 Posts: 131

Yeah, I wasn't making money because I was pulling a freaking van most of last year,didn't know the "system" and swimming with other BCO sharks for the same freight.
Thank God for this Deck, getting RATES that I never had with a VAN.

geomon · Joined: 13 Jul 2005 Posts: 567 Location: Sacramento, CA

henboy wrote:
Quote: How will I calculate depreciation on my truck?I only have about 15k left over after I subtract the gross from the expense/cost to operate.

I believe you take the total cost of your truck (what you paid for it) and depreciate over 3 (or 5??) year period. You can do a straight line (same amt per year) or an accelerated. Your CPA should know all of this.

BanditsCousin · Joined: 05 Jun 2004 Posts: 3195 Location: Chicago, IL

You're still losing me with "subtracting the gross". Remember, gross is the big number. Expenses come out of the gross. Net is whats left.

If you missed parking, tolls, etc, I'd redo the tax form. There is a fee, but see if your expenses meet or exceed the fee. Also, your accountant is tax deductible.

Also, note or not, you can depreciate the truck. How long ago did you buy it? You don't have to write it off the first year you buy it. But there are time limitations, I believe.

And to refute the above comment- Some guys that zero out are making money. Like I said, I netted 24K in '07 :wink:

henboy1 · Joined: 11 Nov 2006 Posts: 131

BanditsCousin wrote: You're still losing me with "subtracting the gross". Remember, gross is the big number. Expenses come out of the gross. Net is whats left.

If you missed parking, tolls, etc, I'd redo the tax form. There is a fee, but see if your expenses meet or exceed the fee. Also, your accountant is tax deductible.

Also, note or not, you can depreciate the truck. How long ago did you buy it? You don't have to write it off the first year you buy it. But there are time limitations, I believe.

And to refute the above comment- Some guys that zero out are making money. Like I said, I netted 24K in '07 :wink:

Guys who are zeroing out are doing something to trigger an audit.Before I went to see him I knew nothing about
Tolls,parking,depreciation,faxes and some few others.bear in mind that I have gone through tolls,faxes,towing and parking etc... but have no receipts for them.The only receipts I have are the fuel,IRP,registration,2290,advalorean tax,maintenance and repairs,supply,fuel,insurance and trailer lease.With all these expenses from the gross, I took home about 23k.I did mention 8k as net because I had the Accountant throw in some figures for parking,toll,faxes,showers, and few others to bring my net down to 8k.I know that was illegal and they will come after me during an audit because I don't have receipts for these few expenses.**** it, most O/O leased on with a company don't even do their taxes.Let them come after me.This should answer your statement "heavy duty".Sorry I didn't mention it but he and I talked about depreciation.He did ask how much I purchased the truck.
Yes 23k is still no money but trust me my net is going higher this year.He also explained the Per diem which fluctuates according the the states you run.If I was left with 8k as my net I wouldn't still be doing what I am doing.

Truck Driving Jobs

Trucking Jobs

Truck Drivers

Trucking Companies

Class A Drivers.com