Independent Contractor

Huh?
IRS does not verify any one as IC or employee. They do give guidelines and fine companies and drivers that choose illegally.
Here are the guidelines...
Understanding Employee vs. Contractor Designation | Internal Revenue Service

 

You're not an employer unless you have "employees" working for you for a wage, and you are withholding and depositing taxes, and paying appropriate payroll taxes, and providing W-2's at the end of the year ... and there's many other tests that come into play in addition to these.

Or did you mean to say "employee"? In which case you can not be both an 'employee' and a [1099 paid] contractor

 

All an IC means is the company your working for does not have to pay their portion of your taxes like they would if you were paid with a w2. You would be giving up some of the rights that standard employees have but also gaining some rights that employees don't have. Just google it and make sure your sources are government sources.

 

Funny thing is, most of the 1099 companies I've personally come across want to pay you via 1099, but want to make all the decisions about when you show up, when you go home, where you're going, what you're doing, as well as putting you in THEIR truck, as well as paying for fuel, and all repairs, which is 100% a legitimate EMPLOYEE position, but yet their paying 1099. They want to make all the profit and bypass paying taxes etc, but still expect to treat you like an employee. How they continue to stay in business without people turning them in, is beyond me.

 

Not really.

See there is an issue about the job, not the start times or the assignments, you are there to do a job for the company that you are contracted to. It is like some one you hire to put a new roof on. You have a start date, a finish date and what he is supposed to do, it is his decisions on how to get the job done at his level of profession.

 

Well it makes sense in that scenario, however, per the IRS guidelines, how can you as a company, hire a driver and pay via 1099 but provide the equipment to do the job, pay for fuel, pay for repairs, dictate where the driver can and can't fuel, dictate which route the driver can and can't take, where to park the truck, as well as not allowing any freedom to the driver to accept or deny loads like a true IC? All of that spells employee. People do it everyday, but according to the IRS in that scenario, it is illegal for the company to classify that person as IC.

That's an exact scenario I encountered this week with a company. Their ad said "1099 or W2" I went, did my interview, driving test, paperwork and opted to be paid via w2. They said no problem. I get my load assignment today along with a message saying that they "can't pay me w2 and that I'll only be able to be paid via 1099" so I started asking questions, and not only do they provide the truck to do the job (obviously), but they dictate EVERYTHING, I had absolutely no part in any decision making along the way from point A to point B. A true IC, even one who doesn't own the truck, will have the freedom to do the job as they see fit. They might have a specific pick up time etc, but beyond on that, it's up to them to get the job done how they want, park where they want, stop and fuel where they want, etc, etc. But for some reason that suddenly changed so I said thanks, but no thanks. Had I been offered to luxury of making my own decisions outside of the usual pick up and delivery time as well as other things involved, I might have accepted becasue the money sounded decent. But when you dick me around before I even get a chance to pick up the first load, I'll move on.

Your scenario with the roofer makes sense, but if you provide the roofer with the tools, equipment, materials, as well as a structured schedule of when he needs to be there, and when he is free to go home, the situation changes from my understanding.

Either way, I'm not against 1099 as long as it's done correctly. To me, when you pay a driver 1099 but treat them to a T like an employee, you're just looking to skimp out on taxes, workers comp, etc. If you tell me you're paying me 1099 and this is where I'm picking up, and this is where it's going and the rest is up to me to decide, then we can talk. But if that's not the case, then I'm not buying what you're selling, but that's just me.

 

How to put this...
The major difference as the IRS and @Ridgeline pointed out are the level of direction put forth by the carrier. Gonna get truck-stop lawyer here.
According to the IRS definitions, if the carrier dictated the route, fuel stops, and when the individual can drive, etc. They are an employee.
However, we must first realize a couple of things.
1. The customer sets the appointment times, not the carrier.
2. HOS are defined by the FMCSA not the carrier.
3. Certain types of cargo and trucks are limited to specific routes.
4. Fuel stops may be required by certain fuel cards.

Now for the really tricky part. I if I am leased to a carrier as an O/O, but I'm required to submit various reports, service equipment in particular places, or get fuel only at recommended locations, am I actually an employee?
The reason I bring that up because that's not a hypothetical question at all, is to point out that we must be very careful how we look at the law. We also have to realize that the IRS code as a presently sits is not to benefit the worker. The IRS code as it is presently written is to designed to ensure the maximum amount of money being poured into the treasury.
If you look at most contracts, the contractor has far more rights than any employee. As an employee every little detail how you perform a function is spelled out in company policy. As a contract you have much more latitude as long as you need two Provisions that are required in the applicable laws and statues.
I'm not going to speak for or against someone working as a 1099 contractor to a company. However I will warn people against making blanket accusations and assumptions without considering all the facts.

 

This is turning into a very interesting thread. So since everyone is talking about the laws view on this matter let's go ahead and put this to rest. As I am sure some of you know Swift lost a case last year against their IC drivers. The judge ruled "the drivers had to drive for Swift solely and Swift had full control of the terms of their relationship" the drivers were more like employees and not independent contractors. If you want to see the article for yourself just google it. It made national headlines so there are plenty of sources to get the story from. So basically if your company has control of the truck then in the eyes of the law you should be paid as an employee and not an IC. That is not to say the company's will actually do that but it does give the employee the grounds to sue for employee level compensation.

 

I speak as an owner, not as a lease purchase ic. My lease is clear on my ability to haul other's loads for other carriers. I am free to haul for other carriers, but I must cover all door signs, etc. If other carriers don't have such language in their leases, then what happened to Swift could happen to them.