1099 or employee

Every audit I have ever been on, the IRS goes after the 1099 employment issue. They do not allow it. I have listed the rules many times. Will not again.
Just because you have done it for years does not make it legal. This is not something just done in the trucking industry.

I know an owner who did it for years and 2 years after closing the business they wanted to reclassify the workers.

The IRS does not prefer, they have posted the rules here.

I am an enrolled agent to practice before the IRS. I am required by law and ethics to give proper advice.

If you continue to do such practice it is your problem. I do not recommend advising others to follow in such activities. Contact the IRS and ask them if they TRULY are employees. Do not hide any facts from them. Tell them your name even if you are so sure it is legal.

After you talk to them and they say it is legal, get it in writing and post it on here.

 

Not being nasty but have to ask you this, if you are what you say you are then why are you fooling with hot shot work?

 

Retirement from the work schedule of 80 plus hours a week. I left my employees and everything.

I now have the sun in my world. Money is not as important as it used to be. Found health to be more important.

I still have many clients that I have had since the early 80's.

Most of us out here would not want to lose the CDL because it is so hard to get. It is nothing compared to getting the Enrolled Agent status. I keep it current for the day that my health or some other thing causes me to return to the office life. Not something I plan on ever doing.

 

I start tomorrow as a 1099'er. I got some very good advice from a man that ran his own trucks for 30 years. 1. Keep every receipt whether you can deduct it or not, personal gas to drive to truck, logbooks, bookkeeping software, ect. IRS laws change often. From what I have read, you can even deduct hotel rooms every so often even though you use your sleeper. 2. Keep 35% of all your income in a separate "Tax Account". 3. Place everything in a shoe box and drop it off at an accountant that specializes in the trucking industry. <---"Your Accountant". Drive safe.

 

Been involved in the accounting industry since 1976. The issue on the employee versus contractor has been a target during every audit since then. I became an enrolled agent in 1985. Seen the issue where it restated the earnings from contractor to employee and almost bankrupted the "employer". This is not just something that happens in the trucking world alone.

http://comptroller.illinoisstate.edu/downloads/20-factor-test-for-independent-contractors.pdf


As I stated, this is a prominent thing they are examining.

Word of caution. You can take as many nights in a motel as you want even if you have a sleeper. The only catch is that since 2007, IRS requires a receipt for proof for all lodging expenses. See pub 463 and check on lodging expenses.

Personal gas is a waste. Keep only records of miles driven on the personal vehicle for getting parts and etc. Miles are at .58 or so each. But, any miles from home to the truck are commuting and not deductible.

IRS rules on this do change, but never in a favorable way. They always get tighter.

 

Thank you for the advice you have given me. I will look around and see if I can get a program or ledger that deals strictly with the Transportation Field for what I can use as legal deductions. I will PM you on the other matter. As it stands in the Commonwealth of Virginia concerning the Construction Profession, these are just a few of the requirements that must be adhered to in order to give a 1099.

As a Construction Company owner, I must receive the following information from anyone I sub out to, IE: 1099 and also what I can and can not do.

1. A copy of their Incorporation or LLC Certificate. It must be one or the other.
2. A copy of their Insurance. Workmans Comp, Liability and Vehicle.
3. I can not tell them when to come to work or what hours they must work. I can only give them "Start and End Dates" for the project.
4. I can not furnish the materials for the job they will be doing for me.
5. I can not furnish the tools that are needed to complete the job.
6. I can not forbid them for working for other companies while they are also working for me.
7. I can not tell them "How" to do the job, only what is expected as an "End Result".
8. All the paperwork submitted by the I/C or Sub Contractor must have his business name and company information on it.
9. All contracts must have the basic information as was determined by the Commonwealth of Virginia.
10. As the Contractor, IE: General Contractor if I use Subs, it is my responsibility to insure that they have met the requirements set forth by the Commonwealth of Virginia.

Once again, THANKS for pointing me in the right direction on the deductions and the other advice you have given as well.

 

Keeping this in mind, look at the trucking industry.

 

"Keeping this in mind, look at the trucking industry". I have Roadmedic. I also know the answer to my own question but also wanted to get some more opinions because of the two different industries. That has now generated more questions that I will probably pay an expert for, just to see what the worst case situation could be for me at this time. Like the old saying goes, "sometimes it is cheaper to pay the fine then meet the requirements". If my liability is minimal, then I will drive on. If it is major, then maybe I can discuss a lease agreement with the owners. Everything I have seen so far is impressive and I like the fact that they seem to be on top of their game. I will let you know what advice is given to me as soon as I get it. Thanks again. Got to roll.

 

I moved to Florida a few years ago, if you have been in business before 2008 I may know you .

 

Construction is a whole different world. I had a framing crew and we done a bunch of sub contracting and 1099ing. You negotiate the job and get 'er done. I did have to have WCI. When trucking it's an issue of using the owners equipment and him dispatching you which puts the person in the employee category. I guess the same could go with construction if the contractor pays you hourly on his job with his tools.