Basic Practices That Trucking Companies Must Do to Succeed

Posted by uptownguy

For those with an entrepreneurial spirit who want to take charge of their destiny and seize opportunities, a career in trucking can be a great fit. However, it’s also frequently a cutthroat, cutthroat industry where slipups and bad luck can mean the difference between success and failure. Focusing on the fundamentals of your business will help you establish a strong foundation upon which to build your chances of success, regardless of whether your company is just getting off the ground or is already installed and expanding.

Invoice-sending and bookkeeping assistance are just two benefits of the best trucking accounting software for businesses. It has tools that can assist companies with tracking mileage, fleet management, and other specialized bookkeeping and accounting requirements.

Tax Obligations For Truck Drivers

Tax obligations for truck drivers must be filed annually, with most drivers using the W-2 form to report their income and expenses. However, you can minimize the amount you owe by taking advantage of trucking deductions. Keep track of all costs, especially any work-related ones. Truck drivers are required to keep receipts for all of these, even for the most minor purchases.

Truck drivers may deduct certain expenses, including motor vehicle records, United Carrier Registration fees, and truck licensing and registration fees. They may also be able to deduct certain health insurance premiums as a business expense.

The Legal Structure of a Trucking Company

The legal structure of a trucking company is essential for many reasons. It sets boundaries between the company’s assets and the owner’s personal assets. This protects private property and is beneficial from a tax and business standpoint. The Business Startup Wizard can help you determine the best structure for your business.

The most common legal structure for a small business is a sole proprietorship. This type of business is easy to set up and requires minimal costs. The sole proprietor can also report business income on their personal tax return. However, the downside of this type of business structure is that the owners are personally liable for any debts or lawsuits of the company.

Logbook or Electronic Log Records As Proof of Per Diem Expenses

Per diem expenses are meals and lodging that a truck driver may incur while traveling. Logs are typically maintained by truck drivers in their trucks and must be marked with them at all times. Keeping logbooks or electronic records can help a truck driver prove the charges’ legitimacy.

If you’re an owner-operator and need to deduct per diem expenses, you should keep logbook records for the entire year. The IRS requires you to retain these records for one year, but some trucking companies only keep pages for six months. To ensure that you keep accurate logbook records, consider digitizing them and supporting a backup copy.

Tax-Deductible Expenses For Truck Drivers

Truck drivers can deduct certain expenses as part of their business expenses. These expenses include truckload dispatch fees, log books, and safety gear. However, there are certain restrictions. For example, truckers cannot deduct personal expenses, such as meals or living expenses. The payments must be necessary for business purposes.

Tax-deductible expenses for truck drivers can also include insurance premiums. Insurance premiums are tax-deductible because they are considered operating expenses. Many trucking companies must carry commercial auto liability and property damage insurance. Independent truck drivers should also consider cargo insurance and business interruption insurance. Many truck drivers also use childcare services, so they are eligible to deduct their childcare costs.

Other expenses that truck drivers can deduct include car washes, maintenance, and repairs. They can also remove the cost of parts and supplies. Keeping track of these expenses is essential. Some truck drivers use office supplies and accounting software to keep track of their costs.

IFTA Compliance For Trucking Companies

IFTA compliance for trucking companies involves understanding and adhering to rules and regulations set forth by the Federal Motor Carrier Safety Administration. These rules cover many aspects of a trucking business, including licensing, USDOT numbering, hours of service, and international fuel tax compliance. The rules and regulations can be confusing, and it is essential to understand what they mean. Several tools are available to help trucking companies meet their compliance needs.

IFTA compliance for trucking companies can be tricky, but thankfully there are plenty of tools to help trucking companies stay legal and increase profitability. For example, IFTA reporting software can help trucking companies maximize fuel costs and utilization while minimizing audit risks.

Related Post

Leave A Comment