Owner Operator Taxes

my boyfriend is a o/o he was in debt about 75,000 because he had people doing his taxes wrong. he pays her 2000 a year every month she takes his statements on what he earned and spent out fuel, repairs, cell phone etc. when he hired her he gave her 1500 and she straightened out those years that had him owing 75,00 when she got thru he got a refund back. and every year after that its only a couple thousand but its better than owing. call your state office they will tell you what the tax percent is. then multiply it by what u hope to make and save that. I live in Arkansas the self employment tax is 4.275% save equal amount for federal tax. my suggestion get u a good cpa/ tax person that understands how to do truckers taxes everybody don't know trust me HR block, Jackson Hewitt good luck

 

When o/o's talk about 'take home pay', they are more likely to be referring to the excess of receipts above expenditures, which is why it is called a settlement and not your paycheck. This amount is not necessarily your profit nor the week's net income. One really has to sit down and talk to a cpa/tax professional to have this explained as there are many variables that can change the actual amount of money one does pay taxes on, both income taxes and social security(or self employment tax, but its the same thing, depending on your business type). If you incorporate, you pay yourself wages like any other employer. If you incorporate and dodge social security tax by not paying enough in wages, the IRS can go back several years and declare the income wages and you own all the taxes with penalties and interest, beware, that can build up to many thousands of dollars, all the way up to doubling the original tax! Not only that, but if you have been dodging social security taxes that way, you are also reducing your social security paid out in your old age. None paid in now means none received later. If you remain a sole proprietor, beware that if you are sued, you can lose all of your assets, even non business assets like your house and car. You need to be a LLC, at least, to protect your assets, if you are l/p, l/o or o/o, but especially so if you have a permanent home or other property.

H&R Block and Jackson Hewitt may or may not know anything about o/o trucking. Most people working in those places are not trained enough to know how to deal with more than a W2, a couple interest statements and a home mortgage. Anything more than that and you NEED the best trained accountant you can find.

Go get quality professional advice, or get in trouble, your choice.

 

Owner Ops refer to their take home pay in much the same way any wage earner does, except they do not have ANY taxes withheld. Even a regular non-trucking employee may owe significant taxes at the end of the year if their withholding allowances are not set up properly. A ballpark of 15-20% depending on your state tax rate should give you a rough idea where your final tax bill will be, especially if you are new to the business and still learning the ropes. A tax professional experienced in trucker taxes can help you tremendously to avoid the nastiest tax surprises, and make sure you are able to take every legitimate deduction your are allowed. Stay away from the chain stores, as their training leaves much to be desired, and very few have any specialized experience, regardless of what they might tell you over the phone or in person.

 

That is 20% of gross, correct? That is the approximate number figuring deductions? Thanks