How many drivers can I hire under LLC?

6 Speed · May 2, 2014

Roadmedic said: ↑

First thing you should know, is that I made my living as an accountant for over 20 years. I dealt with the employment law issues and income taxes along with pensions. So, I am not just another truck driver. I still stay active with personal clients. The issue of employee versus independent contractor is not just for the trucking world. It is highly abused in other industries as well.

The question on post 14 makes absolutely no sense.

Here is the post.

I have my own authority and my drivers are all w2, not 1099. I am debating on having 1-2 trucks lease onto me which will be 1099. Any of my companies will always be w2 though.

As an owner operator that would decide to go into business with you, there is no way I would be a w-2 receiver. I am not an employee. I am responsible for the maintenance of my equipment, my fuel and such. You pay on the w-2 and then there is no way to record these expenses. In the event that you would contract to Swift for one truck, you sure would not be paying them as an employee.

Using this way means that if you paid the local mechanic to perform work, then you would pay them as an employee.

Now, sit back and consider just what an owner operator is and what they provide. Then compare this to the many "scam" pays that you are thinking they are.

http://www.irs.gov/Businesses/Small...ependent-Contractor-Self-Employed-or-Employee

The employee that works as a 1099 employee is nothing more than a misclassified employee. There are many questions that the IRS has that compares them. The first thing from the IRS site is:

I am an independent contractor or in business for myself
If you are a business owner or contractor who provides services to other businesses, then you are generally considered self-employed. For more information on your tax obligations if you are self-employed (an independent contractor), see our Self-Employed Tax Center.

The second one is:
I hire or contract with individuals to provide services to my business
If you are a business owner hiring or contracting with other individuals to provide services, you must determine whether the individuals providing services are employees or independent contractors. Follow the rest of this page to find out more about this topic and what your responsibilities are.

Determining Whether the Individuals Providing Services are Employees or Independent Contractors

Before you can determine how to treat payments you make for services, you must first know the business relationship that exists between you and the person performing the services. The person performing the services may be -

An independent contractor

An employee (common-law employee)

A statutory employee

A statutory nonemployee

In determining whether the person providing service is an employee or an independent contractor, all information that provides evidence of the degree of control and independence must be considered.
Common Law Rules

Facts that provide evidence of the degree of control and independence fall into three categories:

Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?

Financial: Are the business aspects of the workers job controlled by the payer? (these include things like how worker is paid, whether expenses are reimbursed, who provides tools/supplies, etc.)

Type of Relationship: Are there written contracts or employee type benefits (i.e. pension plan, insurance, vacation pay, etc.)? Will the relationship continue and is the work performed a key aspect of the business?

Businesses must weigh all these factors when determining whether a worker is an employee or independent contractor. Some factors may indicate that the worker is an employee, while other factors indicate that the worker is an independent contractor. There is no magic or set number of factors that makes the worker an employee or an independent contractor, and no one factor stands alone in making this determination. Also, factors which are relevant in one situation may not be relevant in another.

The keys are to look at the entire relationship, consider the degree or extent of the right to direct and control, and finally, to document each of the factors used in coming up with the determination.

A business owner can have a relationship with an independent contractor who owns the equipment and sets the rate that they will take for the work performed. The contract can be such that restricts them to the one entity. It does not restrict them to when they work, which route they take, or if they want to take time off. They must be considered b the control.

There is no doubt that there are many people not being properly paid when paid by 1099. However, there is no restriction to a trucking company keeping them from using an owner operator to move their freight and paying them with the 1099.
Click to expand...

#14 on this thread, not the link. I just know the tax deck is stacked against the driver as my own employer has no problem spending 166k on a new truck or throwing new tires at a vibration or paying my fuel bill which averages over 2000/week. I am his only true expense and he is quick too throw it out.

Roadmedic · May 2, 2014

6 Speed said: ↑

#14 on this thread, not the link. I just know the tax deck is stacked against the driver as my own employer has no problem spending 166k on a new truck or throwing new tires at a vibration or paying my fuel bill which averages over 2000/week. I am his only true expense and he is quick too throw it out.
Click to expand...

It has been answered by my above post as far as the law.

The original poster has not been on for over 6 days and has stated that they will own their own trucks.

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