[Dejanh]

Originally Posted by no_worries

And really, what else do you need to protect yourself from as a one truck operation?

One truck operation or 10, its buisiness and i treat it that way. I haul freight that is very expensive, from plasma TV's just recently to a load of gov. products that was worth over 200,000, you cannot be sued if you ran a load for a company that dispached you there. Those guys that are involved in accidents go to jail if they are at fault and they kill someone offcourse, nobody will sue them for their money, if anything happend company is liable for any demages, not the driver.BTW, i will expand my operation hopefully by the end of this year 1

There are tax benefits to being INC. as i found out recently from my Accountant and my tax returns !

[no_worries]

As the operator of the truck you are fair game in a lawsuit resulting from an accident, no matter how you've structured your business. You carry a minimum of $750,000 in insurance and you have personal assets. You think that's not enough incentive for a "victim" to attach you to a lawsuit against whoever you pull for? Those items are not protected by your corporation if you're involved in an accident. Of course you have to be found at fault or negligent, but in a civil case the burden of proof is not near as rigorous as in a criminal case. Hire even one driver and the whole scenario changes, then by all means incorporation is the way to go. I'm not saying incorporating a one-truck operation is a bad move. I'm just saying that to think you're protected from a lawsuit if you're involved in an accident is mistaken.

[GMAN]

I have owned several corporations over a number of years. There are tax benefits to having a corporation. There can be some liability protections, but if someone wants to sue you personally, corporation or not, they will. A good lawyer may even get a judgement against you. Or he may not. It depends on the situation. For the most part, you should have some asset protection. I like the corporate structure because of the separation of assets and tax benefits as much as the protection it offers. I think some are confusing a line of credit with trade accounts. Most banks with whom I have dealt require a personal guarantee with a line of credit for new companies. They may also require a pledge of personal assets to cover any losses until you are established. If you are an established banking customer with a track record, they may or may not require a personal guarantee. In my experience smaller banks are less likely to require the personal endorsement than the large banks, because there is usually a personal relationship. Cell phone and other credit accounts are considered trade accounts and probably won't require a personal guarantee.

[no_worries]

GMAN, for a one-truck operation with average revenues and expenses, where would you expect to see the tax benefits from incorporating?

[ncnewbie]

I've heard incorporating with one person or as husband/wife does not provide protection from lawsuits. Judges will just look at the corporation (LLC,S corp etc) as a sole proprietor operation and "pierce the corporate veil" to allow your personal assets to be used to satisfy claims against the Corp. As always, your results may vary if the judge is a relative, your lawyer plays golf with the judge etc.

As far as $$ advantages to incorporating with only one or two people, I've heard there's some advantages to using a S Corp to use pretax $$ for medical plans. Or setting up a scholarship fund with pretax $$ that only employees' children qualify for. Professional guidance should be consulted in either of these cases -- things may have changed since a researched these 5 years ago.

[pepe4158]

Originally Posted by no_worries

From my house here in SoCal, if I walked out in the backyard and hit a 300-yard drive, I'd have a 50% chance of hitting either an unlicensed contractor or a non-compliant trucker :lol:

Say no_woories....as a rookie owner-op and new authority owner...um whats the most common thing that truckers dont comply with, just looking to learn the pittfalls...(or see what I can get away with lol)

As far as I have known so far I have tried to comply with everything, and not cut any corners, but hell...Ive only just bought a truck and drove it from Carolinas to California, and some CA CHP officer wanted to even give me grief for that ;-p on the phone like I was some idiot he wanted to nail and impound my truck

[RostyC]

You can save some on your social security tax as well.

[GMAN]

Originally Posted by no_worries

GMAN, for a one-truck operation with average revenues and expenses, where would you expect to see the tax benefits from incorporating?

You can pay yourself dividends rather than a salary and avoid paying Social Security Tax or pay yourself a small salary and any excess will be dividends which will avoid the Social Security tax. Social Security costs you and the corporation approximately 15% of your salary. Any salary you pay yourself your corporation must match the Social Security Tax which lowers your taxable profits. If you have a corporation, you can set up a retirement program, such as a 401k, which will also lower your tax bite. The down side here, if I recall correctly, is that if you have any other employee's, they must also be offered the same 401k benefits you give yourself. But there are ways around this as well. You could own your equipment personally and lease it to the corporation. There are a number of ways in which you can lower your taxes under a corporate structure. These are just a few benefits which I can think of off the top of my head. If you file the sub chapter S election with the IRS, your income is basically taxed like a partnership instead of a corporation, but with all of the benefits of a regular corporation. Profits are not taxed twice with a sub chapter S corporation as they are in the standard corporation. The only difference between a regular corporation and an S corporation is the election you file with the IRS. It is only a piece of paper you sign. If someone looks your corporation up they will likely not know whether you have a sub chapter S corporation or not. The down side is that you will need to file an annual report and will need to pay an annual fee to maintain the corporation. The minimum cost in my state is $100. I think it is worth the money. It is difficult to pierce the corporate veil as long as you keep corporate and personal funds separate. It works better if you pay yourself a salary rather than taking money out of the corporation for personal expenses. If you do mix the money and are involved in a lawsuit, you could be considered as operating as a proprietorship and lose any asset protections normally afforded a corporation. While you can still be sued personally it could be more difficult to obtain a judgement.

[Dejanh]

http://new.photos.yahoo.com/dejanhhh...804329405825/0

I didnt know how to load a darn image on here so i posted a link as to how my taxes are paid each quarter to IRS as a only employee of my INC. I pay my self a salary of 1465 each month and deposit checks from my buisiness onto my personal accounts just like it is done with real employees, but here it is just me and North Carolina as well as some other states like Delaware or Nevada give credits to small buisiness owners at the end of the buisiness year and thats where another tax benefir comes in on top of what GMAN talked about...

[pepe4158]

Originally Posted by Dejanh

http://new.photos.yahoo.com/dejanhhh/photo/294928804329405825/0

I didnt know how to load a darn image on here so i posted a link as to how my taxes are paid each quarter to IRS as a only employee of my INC. I pay my self a salary of 1465 each month and deposit checks from my buisiness onto my personal accounts just like it is done with real employees, but here it is just me and North Carolina as well as some other states like Delaware or Nevada give credits to small buisiness owners at the end of the buisiness year and thats where another tax benefir comes in on top of what GMAN talked about...

Yeah this was the main point emphasized to me on the advantage of an Inc. ....salary to yourslef to avoid excessive taxation, but then again you are in a state friendly to business(similar to NV. you said)
While I am in the Peoples Rebublic of CA. (man I gotta get outta here lol)
;-p