1099 CONTRACTOR IN EXPEDITING | Important Info To Know For Tax Time 

Hey Jason, you should make this a pinned or highlighted reply, whatever it is that makes this the first comment people see. Good stuff.

Absolutely. This is what helps any business cut expenses. Thank you very much sir

ronet177 thank you. It can be confusing till you do it a few. Once you get it, it’s seems like child’s play. We do plan our route based on ifta. It’s easier than it sounds. We will work on a video to show my process. After doing it for a couple months you just learn where to fuel because of past planning

Happy Pappy we respect your knowledge but this going into every comment and posting this seems a little overkill. Please see other comments where I provide the fact that 1099 issue is not required by a company. While most do it out of courtesy it is not required under Treasury Regulation §16041-3(c )

No they don’t own any trucks

Cliff Anders The penalty for not filing quarterly is about $80. We preferred not to do quarterly. The only help it really provides is not having to come up with a big lump sum to pay at the end of the year. I would much rather keep that in our bank account then theirs. As you may know not all drivers are able to manage money that great though so doing quarterly may not be a bad thing for those

For sure mileage with a van

Not for freight haulers. Notice the last paragraph 1099 Required? A typical question we receive is whether Form 1099-MISC needs be issued to a company/sole proprietorship for hauling freight? Form 1099-MISC is generally required to be issued to each person to whom you have paid during the year in the course of your trade or business: • At least $10 in royalties • At $600 in rents, services, prizes and awards, other income payments, medical and health care payments, crop insurance proceeds, cash payments for fish you purchase from anyone engaged in the trade or business of catching fish, or, generally the cash paid from a notional principal contract to an individual, partnership, or estate • Any fishing boat proceeds • Gross proceeds of $600 or more paid to an attorney • You made direct sales of at least $5,000 of consumer products to a buyer for resale anywhere other than a permanent retail establishment However, there are exceptions, from issuing Form 1099 to the aforementioned list, we will highlight only two (2): • Generally, payments to a corporation • Payments for merchandise, telegrams, telephone, freight, storage, and similar items If you paid a corporation $600 or more to do work for your company, and the payment wasn’t related to medical and health care payments, fish purchases, attorney fees, gross proceeds paid to an attorney, substitute payments in lieu of dividends or tax exempt interest, and payments by a federal executive agency for services then no 1099 needs to be issued. If you paid an Owner-Operator $600 or more to haul freight for your company then the IRS, under Treasury Regulation §16041-3(c ), determined that NO 1099-MISC needs to be issued, however, household goods hauled by a moving company are not considered freight, thus a 1099-MISC needs to be issued.

Happy Pappy invest your money rather than giving to the govt. It’s a much better return on investment than a social security program which may or may not be there for you in 20+ years.

20+ years I may not be here anyways. I just point that out to people, as I look back and see that mine got messed up with past year's filings because I was misadvised. I could be drawing more now if I had filed differently for a bunch of years.

Happy Pappy Yes, of course it all depends on how many working years we have left. 😉👍

robert palacio I’m curious are they from California. I’ve heard there has been some fuss over drivers hired out of Cali and 1099. For 1099 issue though does not apply to freight. See last paragraph 1099 Required? A typical question we receive is whether Form 1099-MISC needs be issued to a company/sole proprietorship for hauling freight? Form 1099-MISC is generally required to be issued to each person to whom you have paid during the year in the course of your trade or business: • At least $10 in royalties • At $600 in rents, services, prizes and awards, other income payments, medical and health care payments, crop insurance proceeds, cash payments for fish you purchase from anyone engaged in the trade or business of catching fish, or, generally the cash paid from a notional principal contract to an individual, partnership, or estate • Any fishing boat proceeds • Gross proceeds of $600 or more paid to an attorney • You made direct sales of at least $5,000 of consumer products to a buyer for resale anywhere other than a permanent retail establishment However, there are exceptions, from issuing Form 1099 to the aforementioned list, we will highlight only two (2): • Generally, payments to a corporation • Payments for merchandise, telegrams, telephone, freight, storage, and similar items If you paid a corporation $600 or more to do work for your company, and the payment wasn’t related to medical and health care payments, fish purchases, attorney fees, gross proceeds paid to an attorney, substitute payments in lieu of dividends or tax exempt interest, and payments by a federal executive agency for services then no 1099 needs to be issued. If you paid an Owner-Operator $600 or more to haul freight for your company then the IRS, under Treasury Regulation §16041-3(c ), determined that NO 1099-MISC needs to be issued, however, household goods hauled by a moving company are not considered freight, thus a 1099-MISC needs to be issued.

@@modeverything9949 Florida I believe. Garrett G Trucking.

robert palacio interesting. I have heard Florida’s labor board can be very tough as well (not as bad as Cali) as long as fleet owner can keep the fine line between employ/IC it is not required. The biggest issue I believe is fleet owners treating their drivers as employees. Once a fleet owner crosses that line there is no going back. Further that is employment between driver and Garrett. Not Panther who issues 1099 as a courtesy

@@modeverything9949 The biggest issue is fleet owners treating their drivers as contractors, they are not. The fleet owner is a contractor to Panther , lets say, but the driver is a employee of the fleet owner. Look up the rules on IRS, The driver does not have full control of that truck. He or she cant go home when ever they want and stay out for months at a time, you an Jason can because you own the truck. The drivers can't refuse all runs given to him, you can and so can I because we own our trucks. That is a very fine line that ends up hurting the driver, less write offs because he or she doesn't own the truck to write off expenses. Has to pay all their Social Security, no health benefits, the list goes on. This is right from IRS "You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if you are given freedom of action. What matters is that the employer has the legal right to control the details of how the services are performed. If an employer-employee relationship exists (regardless of what the relationship is called), you are not an independent contractor and your earnings are generally not subject to Self-Employment Tax". The Employer "Fleet Owner" can tell you "when you do one more run you can go home" or "No you can't dead home this weekend". The driver does not have full control of that truck or business.

mrtenn1 when we drove for a fleet owner we had full control and was never told we had to do something or could not go home. Now some fleet owner do try to control their drivers and that is the line they cross. Once they’ve done that the irs will see that as a employee/employer relationship. Now we heard something very interesting on Kevin Rutherford’s show the other day. That this way of doing business is actually illegal but the irs does not and has not done much of an enforcing of this. There was a case where 16 drivers sued over being forced to do stuff even though they were IC’s and won. Then the irs came in and retro acted all the taxes that should have be being paid for employee taxes on the company. I am very interested to talk with Kevin about this further.

We save our logs every quarter & also keep copies of our BOLs

@@TheCraftyTrucker thanks for the reply

www.govinfo.gov/content/pkg/CFR-2013-title26-vol13/pdf/CFR-2013-title26-vol13-sec1-6041-3.pdf

Normally but money paid for hauling freight they do not.

Don’t believe so. Paying per diem would make you an employee we believe

Agree

Good question. Since our babies are classified as guard dogs we write off everything for them. Food, treats, vet bills, etc

@@modeverything9949, 🚛🐕👍