got my first truck tax questions.

The rule of thumb is if you NET over $60k in a year, it is best to organize as a corp or as an LLC with an S-corp status. This is so you can avoid self-employment taxes on some of the profits and have them taxed as capital gains instead.

 

Obama changed all the Capitol Gains tax laws. I just bought a truck this year, its paid for and I wont get what I thought I would as a write off.

Also, S-Corp doesnt provide the safety net people think it does. They can still come after you personally while under S-corp status.

I'm still running as Sole Proprietor and have been looking into this myself.

To the OP, in your situation as I understand it, I would just do a sole proprietor for now. Pay your taxes quarterly, other wise you will incur penalties at the end of the year. Consult a CPA for how to conduct your business regarding tax laws.

Hurst

 

Technically as a company you're supposed to pay quarterly but if you incur multiple amounts of expenses, like trucks repair bills that add up, I would leave it to a tax professional to figure it all out. Why give the IRS tax revenue when it's probably not required. I guess in retrospect you will get a nice refund, but that to me is wasting money. Trucking is a high cash intensive business so the IRS can go whistle. If there is a tax bill at the end of the year then fine. You can also put $$ aside for reserves just in case. I put at least 10% away but others may do more, but it's up to the individual.
always good to sit down with your tax advisor every 3 mths just to weigh up the lie of the land and assess the tax situation then. Better not to second guess taxes. We all know what the IRS is all about. They want their money. We all need to be on the ball and be fully aware of where we are on a constant basis.
We certainly don't want to have any surprises at year end and find out we owe more than anticipated.
good luck.

 

As a Sole Propriator you should pay taxes quarterly, then at the end of the year you still need to seek out a knowledgeable cpa to work out your write offs, perdiem etc.

If you over pay, you get your money back just as if you were under a W2. I always get money back.

Hurst