Average revenue needed to survive.

What you save she will have to pay. She ain't getting that money tax free.

 

I'll just get this off my chest, given your similar remarks in the Chattanooga news thread. If this is how you approach people in the real world, you should stay leased to Prime or some other mega carrier. Be a little humble and understand that just because you had success as a lease-op for Prime for a year, it doesn't mean you have unlocked the magic secret to trucking riches, or happen to suddenly know everything. Or maybe it's true, at least within the Prime universe, and you need to stay there to keep it going.

I'm giving you the benefit of the doubt, mainly so it might help someone else that reads this thread. You have already done a great job of snubbing some folks that have offered great advice and answers. Maybe not here and right now, mainly because you seem to only be seeking answers that suit you. You need to shake off the mega-carrier kool aid you've been feeding off of and open your mind up to some people and answers you may not like. The contempt you seem to have for some of the old timers is really going to limit the value you get from this forum. Those men and women didn't get to be old timers by doing a lot of things wrong all the time.

If you're truly considering getting authority and becoming a carrier, know that it's not just the glorified PO lease that the big boys offer. I'm not saying it won't work for you, but it defies the whole point of having your authority. That being, you haul for whomever will hire you. The benefit of that is that you trade off the opportunity for higher rates and less miles, for the added risk that you might not be able to support a given rate target some weeks, for various reasons. That, along with collections risk, service failures, and a few other things that are much less of an issue when leased to a carrier versus being one.

If that's what you want to do, you're better off being leased on versus having your own authority. It's not the same thing. Carriers will always favor their lease-ops over outside contractors. It'd be dumb not to. A little bit of common sense will tell you that a business that pays their lessees say 72% for example, is not going to say "gee whiz this outside carrier is so great, we'll give up a few points of profit to get them on this load." Of course they aren't. If anything, they are going to make more profit off an outside carrier, because it's cheaper and easier to just put it on one of their own trucks.

Load boards in general are the dumping ground of unwanted or cheap freight. Not to say there isn't value there. Eventually you ought to develop some relationships and reputation with some that have (unlisted) freight moving at better rates. The load board can be a good beginning, but is not an end to itself except in times of extraordinarily tight truck capacity. The people that do best as carriers with authority are generally folks that already have some sort of gig lined up. Maybe they have a family member that's the shipping manager at a factory. Or maybe they have a farm and are hauling their own product.

You mention the Prime program for carriers with authority. If you had actually done some due diligence and called their reference carriers, you would learn an important thing. That most of them had direct customers at one time, and now haul under contract to Prime after Prime came in and took the business. At the end of the day, those carriers are little more than a Prime division flying different numbers on their doors. Again, not saying that wouldn't suit you, at least fully understand what you're getting into and at what cost. Not just money, but also opportunity and other costs.

Not being snarky here, but you need to figure that out for yourself. For example, you already said you had a $4,000 truck note to account for. I don't have that, so my number will be less. Only brokers and shippers won't care about that, because their cargo doesn't care whether there's a 2017 Cascadia pulling it down the road, or a 2007 KW.

Trailers cost money, so there is no such thing as a free one. As an independent carrier with no trailer, you really are putting some limits on your opportunities. Remember you are now a motor carrier, not just a guy with a truck that hauls someone else's trailers.

Same with insurance cost. With your own authority you will have to pay for your own vehicle liability and cargo coverage. That is rated on all sorts of factors including but not limited to: years in business, commodities hauled, equipment value, previous loss runs, CSA/safety, IFTA state mileage reports, and so on. A new carrier that is not established will usually be paying $15-20,000 per year (per truck) for the first two years until the rating factors exist and support a lower quote, ideally. It's a cost of entry.

The best thing you can do is make a few phone calls to get insurance quotes and whatnot to find out what your costs will be exactly, then plug them into a simple break-even spreadsheet to figure out what rate you need.

If I threw a number at you it wouldn't mean anything. The only thing our businesses have in common is that we transport goods by truck. The rest is substantially different and will have a big impact on what that break-even number is. Good luck, and I hope you learn to get along with others better. You're gonna need that.

 

What you are not paying as the W9 employer, will be due on her Schedule SE.

 

I don't know what kind of rate calculator you're using, but the SE rate is exactly the same as the rate on form 941 that an employer files. Workman's comp is not payroll. Most states exempt small companies, or at least principles, from WC requirements. In which case, a prudent person would either obtain an Occupational Accident policy at a much more sensible rate, or at least have some other health insurance coverage to fall back on.

 

If she is 1099 that means she will pay self employment taxes which equals same as you're saving on taxes. It will save on work comp.

 

First year insurance with trailer will be $15-20k just like the guy above said. If you and your wife do a corporation, you can pay yourself and your wife $500 per week, everything else will go as corporate profit, that way you can save money on tax

 

Your wife's tax savings would be her 6200 dollar personnel exemption. And than any periderm she could claim.