Can anyone tell me if it's legal to have a driver sign a document that say's they are a sub-contractor and not take out taxes, if the driver is driving the owners truck ? I hope this is the right thread for this question.
Sub- contractor
Discussion in 'Ask An Owner Operator' started by shantyshaker12, Mar 8, 2010.
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No.
To start with IRS has laws against it.
http://www.irs.gov/businesses/small/article/0,,id=99921,00.html
If hes a sub contractor he'll have his own equipment, aka truck. He can pull your trailer with his truck and still be a sub.Baack Thanks this. -
Thanks for the info. I've been working with a company that has 9 drivers who are all working as sub-contractors, but they are all company trucks. Don't really know what to do about it, if anything. When you don't own the truck, and don't pay for fuel you don't get enough deductions.
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You might drop this article on the owners desk.
IRS, states crack down on independent worker abuse
By DAVE GRAM (AP) Feb 11, 2010
NASHUA, N.H. The Internal Revenue Service and 37 states are cracking down on companies that try to trim payroll costs by illegally classifying workers as independent contractors, rather than as full employees, The Associated Press has learned. The practice costs governments billions in lost revenue and can leave workers high and dry when they are hurt at work or are left jobless.
Many who have studied the problem believe it's worsened during the economic downturn, fueling even more aggressive recovery efforts by states.
http://www.google.com/hostednews/ap/article/ALeqM5hdqC3b6B0eL-uQlC7O_sJPB7qNmAD9DQ5KL80 -
Thanks for the link. I might drop a copy in their mailbox.
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Unfortunately when the state and IRS do step in it will likely be the end of the business.
outerspacehillbilly Thanks this. -
SO KEEP RECIEPTS. -
Your tax preparer gave you false info. It is not allowed.
Do yourself a favor and get a second opinion. A second opinion from the IRS website that I posted a link to.
Or better yet a tax lawyer.
I repeat your tax rep gave you erroneous info, or didn't completely understand the question.
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