Leasing at Prime

Discussion in 'Prime' started by ironpony, Jun 25, 2012.

  1. otr48

    otr48 Bobtail Member

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    Mar 28, 2012
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    Thanks for the info IP I don't recall being told about the 2 hr window. I should be going to Pittston the week of July 8th to return and I am definetly looking into the lease end this time. I only have to do a 15k mile refresher and I am trying to get as much info as possible on the different division's good and bad. If I am going to be way from home I want to make the most I can while sitting as little as possible. I have seen some guys who want to spend all there time at the terminals for some reason and thats not me, it's burn and earn keep the left door shut !
     
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  3. ironpony

    ironpony Road Train Member

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    Call recruiting, and see if you can get an exemplar copy of the lease contract up front - gives you more time to read and digest it. I didn't have a problem getting ahold of one as a company driver, but I'm not sure whether they'll just let one out if you aren't in an existing relationship with the company. It's fairly straight-forward, but make sure you get anything that you don't understand explained BEFORE you sign the darn thing. Please, please... have some cash put away before you start!!!
     
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  4. OpenRoadDreamer

    OpenRoadDreamer Road Train Member

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    Apr 26, 2011
    Alabama
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    Great info IP!!! Ill stay company. I dont get good enough MPGs to lease. Current load only weighs 35000, sitting at 6.2 right now. Course I idled for almost 2 hours sitting on the interstate waiting for the tow truck to move the semi to the side of the road. Only goin 58mph, max.
     
  5. ironpony

    ironpony Road Train Member

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    Lets use the "T word." Naa... ain't talkin' about female anatomy!

    Taxes. :biggrin_25521:

    As a lease operator you've graduated to being an independent contractor, and your income is reported on a form 1099. You are now responsible for paying your own taxes. So... buckle up for a wild ride.

    First, since you don't have an employer you are now responsible for the entire 15% of your net that is lovingly titled "self employment tax." Plus whatever they decide you are worthy of paying in income taxes - and don't forget the state boys if you are domenciled in one of the unfortunate states with state taxes. Four times a year.

    :biggrin_25521:

    You really have to stay ahead of this, because if you have to come up with it all at once (to avoid penalties) it can be quite painful. The best approach is to stash some away every week, and make your quarterly payments when they're due. I used 5% of my gross as a rough estimate of what to put away - didn't quite get to that level, and only owed the feds $110 last year - so that's a reasonable way of estimating your payments. You may want to adjust that percentage a bit depending on your individual circumstances. I didn't include anything for state tax last year, but including that I'm up to 5.6% of gross this year.

    The dates the quarterlies are due do not fall on the day that is the end of the quarter, but actually is about two weeks earlier - so don't get caught short. The worst one is the 1st quarter payment that is due on tax day (along with whatever you owe for last year.) Talk about adding insult to injury!!

    The feds have a secure website that you can use to pay your estimated payments online. www.eftps.gov is the address. If you're going to use this for your payments, you need to get it going ASAP. The government will provide you with a PIN number through the snail mail. You need this, a user name and a password to log in. The states are all different, but you should investigate it - doing this online is about as convenient as paying your taxes will ever get.

    Finally, don't stiff the feds. When they come after you, they'll assume that your gross income is all taxable - which will totally ruin your day!
     
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  6. otr48

    otr48 Bobtail Member

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    Mar 28, 2012
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    IP do you use the tax people at prime or have your own ?
     
  7. ironpony

    ironpony Road Train Member

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    I've used Perryman and Associates - now Abacus CPA since I've been with Prime. They have done an adequate job in my opinion, although I've never shopped one of my returns around. Perryman doesn't try to push questionable deductions, so while someone may save some chump change elsewhere I've never been audited, and that's what's important to me. The office they maintain at the terminal is very convenient, and all the billing is done through my settlements.

    If you feel uncomfortable using them, the only suggestion I have is that you find someone who is familiar with the IRS code as it applies to transportation. There are enough differences between what we do and any other Joe out on the street that you can have major mistakes made due to the preparer's lack of knowledge.
     
    Last edited: Jun 29, 2012
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  8. scout80

    scout80 Bobtail Member

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    Jun 28, 2012
    corinth ky
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    i been a lease or o/o since 2005 with a few comp and had a few differnt peaple do my taxs. i only been lease with prime since feb but the tax peaple here at least so far to me seem like they know more then anyone else i had do my taxes and i only have trucker tax peaple do my stuff
     
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  9. ironpony

    ironpony Road Train Member

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    I think its a good place to lease, but YMMV. We're paid percentage, so you're not chasing miles any longer. The Fleet Managers I've been associated with have all treated me with respect, and the relationship is on a first-name basis. Truck numbers are only used to pull-up data on the computer. I've run both company and lease here, so I can say that I'm making more money with the lease. $800+ weekly average for my company years, while its $1100+ on the lease side, running reefer division, solo. I wouldn't call them excessively supportive, but they do try to point you in the right direction. They expect that you are an adult entering into a contractual business relationship, and that you need to help yourself.

    I expect you have some experience as a company driver being paid per mile. Some of that you will have to throw out the window. You must run your truck as a business to be successful here - so some business education is a prerequisite. So is separating your business and personal financial concerns, and its imperative that you have $2000 or $3000 in your business account to help smooth out the ups and downs of your settlement checks. Your settlement check is cash flow into your business, and you must pay yourself a salary. It's important to remember this is not employment on steriods, but you will be starting a small business.

    The key to it is minimizing your expenses - so blowing $100's at the truckstop on advances is a thing of the past for you, and the fuel bill is the king of expenses. If you got a lead foot chasing miles as a company driver, you'll need to get rid of it. The lower your fuel costs, the larger your settlement check will be.

    There's some quick thoughts for you... hope that helps. Got more questions?
     
  10. Vwal528

    Vwal528 Light Load Member

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    Dec 25, 2011
    Albany, NY
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    Thanks a lot for addressing my very broad question. That gives me some things to think about, but its good to hear from somebody who is doing it successfully.
    Right now I'm a company driver for Roehl Transport, their lease program pays per mile. Wouldn't it be better to have shorter runs if your earning a percentage? So you can haul more loads?
    If you getting mileage, your getting paid to drive, no matter how many loads you deliver. Am I right? I've always heard the percentages are better, but say you get a long 1200 mile run, doesn't that just mean more expenses to deliver the load??
     
  11. ironpony

    ironpony Road Train Member

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    Generally... but the shorter loads means less fuel burned. You have to look at your expenses on a per day basis or a per week basis. It costs me about $150 to sit around for a day - just in fixed expenses. I need to pull in about $550 a day to cover those fixed costs, operational costs and to pay myself a basic salary. The per-mile guys have to chase those miles, and push the driving to the limits to make enough money. I was comparing notes with a per-mile lease operator from another company... he was putting in 1.5 times my miles, and clearing less. The percentage approach gives you the opportunity to hit a home run - something you can't do per mile. $500 load for 10 miles - something like that. I find that minimizing the costs rather than maximizing the loads brings in just as much if not more money.

    Of course there is more risk than what you get with an employee paycheck. If the economy goes south, it tends to hit us harder because of the fixed costs. That's where running economically comes in - the guys running lean in the first place tend to make it through with their shirts on.
     
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