Does anyone have a holding company they keep their trucks and equipment in then rent it back to the operating trucking company to use? Is it possible or does that mess up insurance and the like? I'm in Canada but I'm sure it's similar. Thanks
Also does OOIDA insure Canadians? Are their rates any good?
Holding company for equipment?
Discussion in 'Ask An Owner Operator' started by DaytonTD, Dec 3, 2020.
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I know of a company that runs a zero dollar accounting. The liability is controlled by a corporation that basically has zero dollars and the equipment and assets are in another corporation, That way in case of a lawsuit, the corporation that gets sued has no assets.
DaytonTD and Midwest Trucker Thank this. -
My attorney and accountant strongly recommends I do that but so far I stupidly haven’t.
Basically create a new LLC that owns all the equipment and leases it to your trucking company. Im also supposed to create another LLC that holds my brokerage as well.
My Truck Leasing LLC - Owns Trucks and Trailers
My Trucking Company LLC - Operates the trucks
My Brokerage LLC - Operates the brokerage
I’m sure many companies have it far far more complex even but that’s the next step for little guys like most of us here. It helps insulate liability from one sector bringing down other sectors so they say.RockinChair, D.Tibbitt and DaytonTD Thank this. -
I currently have an accountant looking into it. One of the stumbling blocks is that my business that owns the trucks was a C corp that I changed to an S corp. Along with that came a requirement that if I sell equipment I have to pay 30% on it for five years. I have another year to go. I'm not sure if you can just move the assets from one company to another without some sort of tax penalty. That's why I have pros looking into it. One of the reasons I haven't looked hard at it yet is that the truck's 1079 deductions help alleviate the tax burden of the rest of my company. Lease payments to a holding company might be just as advantageous. Once again that's why I'm paying a pro to look at it.
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Yes. You preferably want the corporation operating the trucking business to have no assets and little to no cash. They will come for it all if there’s an accident.
Midwest Trucker laid it out well. -
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