TFS Online Newsletter

TRUCKERS NOW PAY LESS INCOME TAX
AND SOCIAL SECURITY TAX...

In my Rush Limbaugh type wisdom, I noticed among other things, two outstanding disparages. First, his revenue dropped by more than 20%. Second, the biggest drop was between 95 and 96.

What happened I ask myself? Well; the industry started giving bigger discounts and the next, HE WENT FROM A 44-FOOT TRAILER TO A 53, 102 TRAILER. Now he can haul more and make less! Thank you very much.

When I first hauled produce in 1970, the weight limit was a little over 72,000 gross in a 40-ft trailer. Then in 1981 I again went back to hauling produce, in a 44-ft trailer at 80,000 pound gross. Now 48 footers are becoming extinct. What next?

That's right! The loads are bigger and heavier and the revenue is less. Truckers now pay fewer taxes. What's a trucker to do?

TRUCKERS FINANCIAL SERVICES, what is that? It says on our business cards: Detailed bookkeeping, Income Tax Returns, Complete Tax Analysis, and Total Financial Planning. No, I don't finance trucks!

A business, to be successful, must have a plan. That plan must detail the operation, finance, growth and future of the business and owner.

For last year, I did the taxes for 10 truckers over the age of 60, 4 that were over 65. There were six that were put into bankruptcy because three had their trucks stolen, one burned, and two collisions (one in a truck stop parking lot. None of the truckers were hurt, so not being able to work was not a factor. I also had three truckers that parked their trucks in the back yard and went to work for local trucking companies. There were three more put off work for job related injuries. I also had more than 100 qualify for Earned Income Credit. That by the way is what the government gives you when you have kids and are earning below the poverty level. Besides all that, there were three that lost their licenses.

Would financial planning have helped these truckers? Even the last three! It doesn't make any difference if you are a driver or an Owner Operator, the goal is the same. To make a good living and be able to survive when you have to quite driving.

A few years ago I wrote an article called "FINANCIAL PLANNING THE KEY TO SUCCESS," it ends with "The road to success is uphill. There are experts to help you carry the load. Sometimes you are out of breath from the struggle, but the view from on top is incredible."

As I said before, there are experts to help you carry the load. The true blue followers of this newsletter are one up on the industry. I have never met Lew Grill, I meet Russ Fullingim every morning when I shave, but I can tell you from experience that you can't find any better advice at any price.

If you are thinking of buying your first truck, you must get the best information that you can in order not to make the most common of mistakes that can keep you behind the eight ball.

For all you Owner Operators that are licensed for 55,000 pounds or more, it is JUNE. That means that in one month you get to donate to the US Treasury up to $550 for each vehicle. The tax is due July 1 and must be paid by August 31. You must file an IRS form 2290.

If you have gone out of business or you no longer have a taxable vehicle in service, you need to file a final return. Write "FINAL" on the top of Form 2290.

If you are an Owner Operator you must have or get an EMPLOYEE IDENTIFICATION NUMBER. The new law says that if you file a Schedule C with your income tax you must have the number. If you got by this year without it, LOOK OUT!. Uncle is looking for you! You can get the number by filing a Form SS-4.

If you file your Form 2290 on time, you can pay your tax in 4 installments. But it must be filled on time. The installments will be due on December 31, March 31, and June 30. There is a penalty for late filing.

Here is something most IRS people and accountants won't tell you. If a taxable vehicle (one you have filed a Form 2290 on) is destroyed or stolen before the first day of June and subsequently not used during the tax period, the tax is prorated. A vehicle is considered destroyed when it is damaged by accident or other casualty to such an extent that it is not economical to rebuild. You can file an IRS Form 8849 to get your prorated tax back. If you sell it or just park it, you are not entitled to a refund.

If you have had this problem, you have three years to file the form.

If you need a form, you can get them from SOME IRS offices, or call the IRS at 1-800 TAX FORM.

Remember to, that you can license your truck for a lighter weight if you do not haul heavy freight and then can pay a lesser tax on the Form 2290.

For any tax and accounting problems call me. OR fill out the client information form at the end of this site.

HAPPY MOTORING AND I WILL...SEE YOU AT THE TOP.

RUSSELL E. FULLINGIM, CTP