LLC. Advice

This is true regardless if you are a company driver or an o/o, that is what the last part of that post was trying to explain.

If anyone is found personally liable of any incident, that person is personally responsible and may lose everything this is true.

The question is about corporate protection, if you had a driver that was mad at you and started the fire. The driver not your business would be personally liable.

 

LLCs and like entities can not pay out dividends. These are essentially sole proprietors/limited partnerships with an added liability protection layer added which does not work with owner/operators.

You pay taxes on everything, you are limited to the amount of deductions you take compared to a C-Corp and your tax liability is based on personal tax rates which for most would save them some money if they are a single truck operating under a single lease.

A properly setup and run corporation will save you money on taxes even if there is "double taxation". The problem is most don't get the right people to help them and get overwhelmed with the BS government speak by trying to do it on their own.

 

You are still taxed but not as personal "EARENED" income tax. Because you did not work as an employee for a company.

Anyone who has done sales and received a 1099 instead of W-2 knows this. If you are a Lease Purchase driver you will mostly likely receive a W-2 and you are screwed in this way cause that means the company has you on their books an employee and has reported you as such to the IRS. If you are an O/O you should be receiving a 1099, because you are a contractor/non-employee.

You are taxed as "NON-EARNED" income tax which is the same amount of taxation as Earned income taxation, but now you don't pay Social Security because Social Security is calculated off your "Earned" income ONLY, for witch you have none of.

 

Lease purchase drivers receive 1099, not w-2.

There are problems with the S corporation, if the person who draws the salary as an officer is not really paying themselves a fair wage. It can lead to restatement of the wages. It is one area the IRS watches to be sure of the tax affects.

S corporation also limit the benefits that the corporation can pay for the officer.

 

Dude, just stop. You couldn't be more wrong. You are giving very bad, incorrect advice.

If you are doing what you are advocating, and not paying your self-employment taxes, you are breaking the law. Bragging about it on a public forum is foolish.

 

This is a PERSONAL liability judgment of court case and not even bankruptcy will remove you from these anymore. It doesn't matter if you have earned income or non-earned income these types of judgments are normally based on a percentage of your total income.

There are still a few ways this can work in your favor. I have a personal ethical issue with this issue, so I'm not explaining them to you. But you might want to speak to a Tax Lawyer who understands child support in the state that the judgment was filed.

 

This is why you're beter off using the schedlue C deductions on pre tax money unless you're making lots more than I am. Itemizing a regular 1040 never had the same effect for me.
I think some folks think adding llc or inc behind some names makes it worth more.

 

So what is point of changing over from a sole proprieter to a LLC if your a 1 truck owner? Because it sounding more and more like it isn't any.

 

There really isn't.

The idea behind the LLC is to insulate your personal assets from your business assets with some pass through tax liability but because we are in the business that is first regulated (HOS, insurance requirements, etc. ... ) and because most who are owners are also operators, the insulation goes away. A good lawyer who is willing to dig can rip apart an LLC and put everything on the table that you and your family owns.

The advantages of a corporation is that if it is structured right with the right plan, can save a lot more in taxes because of the limits that are put on the LLC/Limited partnerships/S-Corps.

 

Actually none.

The money is yours and you do not have to worry about money removed from the business voiding the corporation or LLC, or S corp.

Liability under any corporate shield to a one truck owner and such becomes a cloudy issue. If done right, you can accomplish some savings under a corporate identity for taxes, but it requires discipline.