Teach me about 1099 and lease purchase

You just had a premonition. Trust it.

I’ve seen many lease purchase statements of guys busting ### whole week and still owing money to the leasing company.

 

Exactly.

I don't know what the success / fail ratio is but on the 1099 Lease, most evidence points towards fail.

I know you want to get back to driving. F'd up and are trying to make it right with a last option.... Do you have anything, ANYTHING, else you could do?

I'm not trying to turn you away from your options / choices - just want to make sure you've investigated them. Everyone is hiring.... I work out of Thomaston, ME - I could drive down to Damariscotta everyday and work at Dunkin Donuts for almost the same wage I do as driving a truck.....

I'm not here to debate "fairness", but getting in now, with the external market like it is, and with the world knowing that brokers are taking you for a rip.... I'd hesitate.

Complete your program. If you want to drive professionally: don't smoke the reefer. I quit 3 weeks before I got my CDL, pissed clean & haven't looked back..... and I smoked A LOT.....

Continue your investigation, good sir.

 

The 35% is sort of a national standard recommendation for taxes after any legal expenses/deductions. One point I never see mentioned about the 35% is the state you live in has a huge impact. The 35% number is sort of a 25/28% federal and 7/10% State taxes. If you happen to have residency in a state with low or even no state income tax to small business owners then you can be closer to the 25% number. Keep in mind though some of the no state income tax states are only referring to people with a job and not self employed. Washington state for example always touts no income tax which is true if you work as an employee but if you are self employed they actually have a b&o tax which is based on gross revenue and can add up fast. The bottom line is put aside at least 25% and then factor in whatever state you live in and that should give you a good number to work off of.

 

I'm not all knowledgeable on being an o/o or 1099 user. Personally I believe that 30% is a bit high. I pull containers from the port or rail yard and I drive about 160 miles a day. I am never further than 40 miles from the office and work bankers hours. Two years ago I made $105,600; after write-offs I paid $6,121 for income tax. Last year was a little less income, write-offs and payment. Each year I saved $12,000ish for the taxes. I have been doing this for 7 years and pay tax yearly.
Hope this helps you somehow.

 

Going to call BS on this, you only applied at 40 companies out of a few thousand and can't find an employer?

Seriously a lease purchase should be done with someone who hasn't taken a break and has an understanding of how to run the truck from an owner's point of view.

There is a heck of a lot involved with a LP, the contract needs to be explained to you by someone who is on your side, not the company. Request a copy of it and have a lawyer spend an hour with you going through it. Make sure everything is spelled out on who is responsible for what and how things are going to be divided up. The same goes for the employment contract portion, it really should be separate from the truck lease agreement.

Before you get ahead of yourself, understand you need an accountant and that accountant needs to be an EA, someone who can work with the IRS and state tax people for you.

That said, going back to the contract, it will define who pays what and how it is to be paid. IFTA is one, but the maintenance funding, the buyout, and so on need to be explained to you by someone other than a recruiter or some other ******* clown.

You won't have much choice, get a Cascadia if you can with a Detroit and 18 speed, as new as possible.

Well you learned a lesson that many of us warned drivers about, but there are more than 40 companies out there. AND a few may help with the completion of the program, did you check locally?

Look being very honest with you, the company isn't doing you a favor, they see you as a desperate person trying to make some money and do it as easily as possible, so they will take advantage of you. The more you understand how to protect yourself, the better off you are. A lawyer to read through the contract, to show you the gotcha's and screw over clauses is the first thing, a good accountant who can set something up for you so you can save for taxes and so on is the second thing. The company isn't there to make you a success, they are there to squeeze pennies out of you.

at least 35% of the gross to you.

Yeah that's good but can you do it? Will the company allow you to find freight or will they dispatch to you - which means you are an employee? What about signing on with another company, will they allow you to do that with your truck?

The recruiter is full of ******, you are an independent contractor, you are running under their authority but then it begs the question does this require you to have that extra layer because you are an independent contractor or is it you can be a sole proprietor - this can only be answered by either the lawyer or the accountant.

I would take the next step which is to ask for the contracts in hard copy, not get them electronically. Tell them you need to have them reviewed. If they make any excuse or they say no - WALK.

 

LLC won't add any protection to an O/O. You are the driver so any accidents or liabilities get passed to you the truck owner.

I say wait. Find a local driving job to hire on. Someone will hire you. Jumping in to a Lease purchase is putting your future at risk.

You mentioned the truck you drove had to be serviced with several forced regens in 10 months. No way to predict necessary maintenance or repairs. Do you know how much that cost? What will happen if this happens the same week you start driving your new truck. Do you have enough to pay $20,000 in repairs the first week.

Review all your decisions with a lawyer and CPA.
Good luck with your choice.

 

I'll agree with the others. ALWAYS form an LLC. When I first bought my truck, I thought it would be simpler to just run a sole proprietorship. Those in the know quickly convinced me that unless I wanted to end up homeless from one boo-boo, that you need to separate yourself and your business by running through an LLC. This isn't a job where the worst mistake you can make is forgetting to put the ketchup in the bag...

 

Don’t know your expenses but when you get the money, the Net put that into a bank account, pay yourself a salary, whatever you decide you need.
700/week or mileage or %.
Keep that and rest stays in business bank account, pay business expenses from that, do your payroll taxes say from your pay, set up something like an LLC taxed as S corp, talk with an accountant.
one that knows trucks.

Pay your taxes monthly, off your payroll, you can or have CPA do it by sending how much you paid yourself a week.
EX. 1-6-23 $1000 1-13-23 $1000, (fridays if you need or pick a day for pay)

But if i was forced lease purchase, I’d do it with a company i could trust and dispatch myself, not someone controlling my money.

 

This is another active thread, maybe it will help you.

Companies or small carriers that hire SAP drivers

 

Delete-- my words didn't match my thoughts