Taking taxes out yourself
 

Does anyone know the process of taking taxes out of your paycheck on you own and how much you should take out?
I know I need a 1099 form but thats about all I know :roll: .
As for my dependents and all, I plan on claiming 5.
myself, wife, and 3 kids.
I also understand the more I claim, the more I keep per keep, but less I get back on my return. Thats fine with me, as I would rather have the more money every week.
Just mainly wanting to know how to "take out my own taxes."

If your are self employed you are supposed to make "estimated tax payments" to the IRS 4 times a year. June 15th, September 15th, January 15th and of course April 15th. The form is the 1040-ES.

You will probably also have to do the same for your state and/or local taxes.

You should speak with a local accountant (preferably someone who knows about trucking ). Ask other O/O’s or contractors in your area who they use.

Below is a good link with more information to get you started. But like I said, spend a little money now to talk to an accountant. This will save you a lot of troubles later on.

http://www.fairmark.com/estimate/

I should mention that I really am in my eyes, a "company driver", but the guy running the gig says my title is "independent contractor". Dont know what different this makes, but just thought i'd throw that out there.

It would be a good idea to talk to an accountant who is familiar with trucking to give you some guidance about financial planning. However, you can go to the IRS website and get the booklets and forms you need to start filing the self employment taxes. You can also go to your local IRS office and they can get you started. You will likely need to apply for a FEIN (Federal Employer Identification Number) rather than using your Social Security number. The IRS can usually get your number while you wait.

Anyone have an idea who much a typical accountant visit will run me?

The guy I'll be working for also asked me if I'd be interested in buying the truck I'll be driving (Thats a whole other post in itself..) If I were to do so at some point during 2008, would that drastically change things, as far as what I need to do tax wise?

there's a trucking business program of XM radio 171-
Kevin Rutherford--

they were talking about this very subject the other evening....very good advice above- talk with a professional CPA that Knows Trucking. Don't know
how much this would run- probably $150.00 for a 1/2 consultation---then if you like what he tells you- probably retain him on a payment plan.

If you are only talking about paying self employment taxes and driving a truck for someone else, then that won't involve much time. I would say about $50/month, if that much, if you want to look at a monthly charge. If you are talking about using an accountant to help with your books running a truck, it will likely cost a little more. Most accountants work on an hourly rate. The cost will be tied to how much time he needs to spend giving you what you want. Most accountants will meet with you and give you an idea of what it will cost. I doubt there would be a cost for the initial meeting.

if the guy he drives for 1099's then he is a sub contractor...or self employed. he need to talk to an accountant. find one that will take a little risk, without throwing up huge red flags. there are alot of ways to mae money go away so that you do not pay taxes. i work this way and paid under 1000 in taxes last year, that was federal and state combined.

My accountant set me up at tax time last year. The easiest way is to put money aside into an account now, and wait till tax time. If this is your first year, you can file and your accountant will tell you what you owe. Keep lots of reciepts for gloves, flashlights, even batteries for the flashlight. Once you file for '07, he can tell you your estimated payments for '08, and, if hes good liek mine, prints out the proper forms for the state and federal w/ per-addressed envelopes.

HTH, Happy Holidays.

This is true. When I was a lumper for an atlas agent they paid us as 1099 contract workers, which was weird. I still filed as 1099/independent contractor. Now whether I was more of an employee or not is easy to see. They did it to get out of matching your employment tax and benefits. they clearly dictated what/when I was working, provided the quipment, and the other aspects that would indeed classify me as an employee. They had 2 guys that were full "employees", and all Atlas qualified drivers were too (taxes taken out).

i understand what you said, but if he gets a 1099 then he has to pay his own taxes...including self employment. i still consider myself someones employee.

Just because you get a 1099 does not make you an independent contractor. Check with the IRS (accountant or lawyer) on the rules for being an IC, most in transportation are not Independent according to the IRS guidelines. I've been through a few cases, the courts and IRS decided the company could not count me as an independent contractor because I was treated like an employee, they were required to pay the taxes, not me. If you really are self employed get a basic accounting program, they usually will walk you through all the paperwork, deductions etc., and keep track of everything for year end taxes. Depending on your income you may have to file quarterly.

He's not asking his status, just how to pay the taxes. He clearly isn't an independent contractor.

whether he is independent or not, if he gets a 1099 then he is responsible for his own taxes.

his employer can be assesed a penalty,not him. i think he is wanting to take care of himself. yes, yes, we all realize how smart you are with the tax codes. but you need to look at his situation. he asked what HE needs to do, not what he really is in the eyes of the law. he simple fact is that his employer is not taking taxes out on him, thus making him responsible for them. i for one would rather deal with that then go to jail for not paying taxes..no matter what the rules say regarding my position.