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Old 03-05-2008, 02:00 PM
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Interesting stuff from the great minds.
So how many sole proprietors on here have their business incorprorated?.I am talking about people with just one truck?
So what's up with this guy at some Pilots harrasing me about getting some kind of Legal Protection(kind of like prepaid legal) against suits?He claimed drivers involved in an accident are always going to jail and this has nothing to do with DUI, documents or DWI .I know most of you have met this guy at the Houston Pilot, they claim they will stand behind you when you get a ticket, courts etc...
He sounded like a typical salesman, I just asked for a web which he couldn't produce an informative one and I walked away with his card in pieces.With a 1 million liability coverage or whatever the dollar amount is that I pay about $60/settlement for ( for bobtail and HCP), what exact protection am I getting when it comes to suits?Please exclude the HCP which is the occupational hazzard.How can I go to jail for an accident that was my fault that didn't involve DWI,DUI (excluding vehicular manslaughter) and include the fact that my LOGS and documents are all up to date.This is veering off the topic but I am curious.
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Old 03-05-2008, 02:52 PM
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That's an excellent point about often needing personal guarantees as a new corporation, GMAN. So basically, for a one-truck operation, incorporating not only does not provide liability protection in an accident (even if your corporation carries mucho insurance, there's no rule saying they can only sue one party) but if you don't have excellent credit it may not even shield you in the case of a financial meltdown.

As far as retirement plans go, there are more options available to the self-employed than regular IRA's. Simple's, Keough's, solo 401(k)'s all allow higher contribution limits than the old stand-by, some over $40,000 per year, and all tax deferred. I doubt that there are many one-truck O/O's out there who would exceed that limit. Matching contributions are irrelevant, as is vesting for a one-truck setup.

Taxation, we've debated ad nauseam, no need to rehash :lol:

As soon as you get a second truck, of course, by all means incorporate. But I have yet to see a compelling reason for a one-truck O/O to incorporate.

Henboy, you rightly disregard those sales pitches. Your insurance coverage is exactly that; in simple terms, any suit you lose stemming from your driving will be covered by your insurance company up to the limits provided. If the judgment is for more than your coverage, you are liable for the difference. However, since you're leased to LS, they will most likely be targeted, though that doesn't necessarily leave you off the hook.

If an accident is your fault, you have to have been negligent or reckless in some way. If someone dies as a result of your actions and you are judged negligent or reckless, that is manslaughter, and imprisonment is a possibility. If there are no fatalities then the odds of going to jail aren't very high, unless you were doing something very reckless. Then you're talking jail, not prison.
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Old 03-05-2008, 04:53 PM
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Henboy, you either have a sole proprietorship, partnership, corporation, LLP, or LLC. Those are your basic ways in which to set up your business. You are probably currently operating as a sole proprietorship. You can leave things as they are or choose from the other options.

There are other reasons where you could be arrested other than those listed, although those are the most likely as a driver. I don't know of any prepaid legal service which will protect you from lawsuits. Most of those only act as a referral service should you need a lawyer away from home. You can usually do as well on your own and save the money. They sell the idea of finding a lawyer who will take your case at a discount rate. They are mostly for traffic related incidents. Should you get a ticket while on the road, you call them and they will find a lawyer in the area, who will represent you. The idea is to get your case dismissed or plead down to a lesser offense that will not impact your CDL. There are several such services available. They are all pretty much the same.

Until your corporation is at least 2 years old, you will likely need to co-sign any banking documents. It takes time to establish credit. You may also need to pledge personal assets to cover a line of credit or other types of banking needs until you are better established.

No_worries, I am glad to hear that you can now have a 401k or other types of retirement accounts as a sole proprietorship.

Henboy, if I were you, I would find a good lawyer and discuss your situation with him and see which structure would best serve your needs. Find a corporate attorney or one who is also a CPA. They can make suggestions to you for your particular situation. Everyone is a little different. I have nearly always had a corporate structure within which I have operated. That is what I prefer and it makes sense in my situation. I have owned several corporations over the past 30 or so years. There have been times in the past where I have been asked to provide a personal guarantee. Since my corporations have been around for a number of years and have a good track record, I don't always need to do that any more.

You may find some vendors that may extend your corporation credit to help you get started. Capital equipment will often require a personal endorsement until you become established. But, you need to start somewhere.

You will have less liability than I will due to you leasing to a company. I am the company. I run my authority, so if I should have a big claim and my insurance doesn't cover the loss, then they would come after the assets of my corporation. If that doesn't work, then they could try to come after me personally, but would probably not have as much success in that area.
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Old 03-06-2008, 04:43 PM
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Quote:
Originally Posted by GMAN
Henboy, you either have a sole proprietorship, partnership, corporation, LLP, or LLC. Those are your basic ways in which to set up your business. You are probably currently operating as a sole proprietorship. You can leave things as they are or choose from the other options.

There are other reasons where you could be arrested other than those listed, although those are the most likely as a driver. I don't know of any prepaid legal service which will protect you from lawsuits. Most of those only act as a referral service should you need a lawyer away from home. You can usually do as well on your own and save the money. They sell the idea of finding a lawyer who will take your case at a discount rate. They are mostly for traffic related incidents. Should you get a ticket while on the road, you call them and they will find a lawyer in the area, who will represent you. The idea is to get your case dismissed or plead down to a lesser offense that will not impact your CDL. There are several such services available. They are all pretty much the same.

Until your corporation is at least 2 years old, you will likely need to co-sign any banking documents. It takes time to establish credit. You may also need to pledge personal assets to cover a line of credit or other types of banking needs until you are better established.

No_worries, I am glad to hear that you can now have a 401k or other types of retirement accounts as a sole proprietorship.

Henboy, if I were you, I would find a good lawyer and discuss your situation with him and see which structure would best serve your needs. Find a corporate attorney or one who is also a CPA. They can make suggestions to you for your particular situation. Everyone is a little different. I have nearly always had a corporate structure within which I have operated. That is what I prefer and it makes sense in my situation. I have owned several corporations over the past 30 or so years. There have been times in the past where I have been asked to provide a personal guarantee. Since my corporations have been around for a number of years and have a good track record, I don't always need to do that any more.

You may find some vendors that may extend your corporation credit to help you get started. Capital equipment will often require a personal endorsement until you become established. But, you need to start somewhere.

You will have less liability than I will due to you leasing to a company. I am the company. I run my authority, so if I should have a big claim and my insurance doesn't cover the loss, then they would come after the assets of my corporation. If that doesn't work, then they could try to come after me personally, but would probably not have as much success in that area.
I am definitely going to print this stuff for my records.I am changing CPAs and keeping it the way it is until I have a 2nd truck.
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