Newly Licensed CDL Being offered 1099 pay? HELP

It's an illegal scheme to dodge paying taxes on your payroll. 1099 is a way for boss to spend less but make that lesser pay seem larger than W-2 pay. You have no business doing 1099 work unless you bring a truck that you own. You will do it and then be back to ask about the many thousands of $ you owe in income taxes. Newbies jump off tall buildings and later ask about how to avoid hitting the ground.

 

I used to think this way also but the reality is it sucks even if you are a true 1099 driver not controlled by the company and allowed to run the truck as your own ship per IRS rules. I've done it for short term. But that's all it's good for. It's a short term stop gap measure until you can get into a proper W2 job or get your own truck fixed and back on the road again. For someone who's never run their own truck and has no clue about finding their own freight it's a very bad idea to be paid as a 1099 driver short or long term.

None of the truck expenses of any kind should be the responsibility of a "1099 company driver". Absolutely green rookies and even experienced company W2 drivers who have never found their own loads should not even attempt it. The worst part, that's been pointed out but needs emphasis is, you have no truck expenses for write-offs. And by the time YOU pay for the benefits that most employers offer much cheaper to their W2 employees you'll discover that you're working really cheap.

What usually ends up happening is the vast majority, truthfully probably all drivers doing it, have ZERO benefits or insurance of any sort and even worse they don't put back any money to pay taxes quarterly (or annually if you just take a small penalty). Then April 15th they find themselves with a tax bill of $10,000-$20,000+/- that must be paid in full but they don't have any money. Does this sound like fun?

 

Yeah... I'm pretty sure I would run away from that job.

 

China, I have my notifications turned off. This is my bad habit I've gotten into, so text me if you have something for me to respond to.

It means me, I have a fleet with a mix of Legal 1099 and w2 drivers.

OK first understand that being an independent contractor means you have the freedom to pick and choose the work that is offered. This is very important irrelevant to who owns the tools.

Second everything is based on an agreement which is in physical form, a contract. It spells out the duties of each party, the pay schedule (including chargebacks and accessorial fees), and who is responsible for the fuel, maintenance, and repairs to the vehicle and trailer. I have to be clear on the last part because the normal situation is the owner is responsible for everything to do with the truck, and the driver pays nothing. I have a bunch of drivers who pay for fuel but they also get a bigger part of the revenue because of it and make more money because they know how to get cheaper fuel for the work they do.

Also, in the contract is how things are handled when there is a problem, what policies are in effect for the driver (which the driver needs to receive), and other details.

The contract can't be a boilerplate one off the internet or a copy of someone else's is a bad thing, it shows how lazy the owner is.

My standard driver contract is 23 pages long, then the addendum which is specific to the driver and their work is another 4 pages. I or one of the managers go through each driver, clause by clause, and have a plain English explanation sheet. Communicating all of this is very important.

Now should you work for a company like this having a new CDL?

Hell no!!

Get a w2 job at a larger company with the resources to properly hone the skills you demonstrated getting your license.

 

I enjoy 1099 work because one of my favorite things to do is getting out of paying taxes. If you are W2 you are locked in to paying a lot of taxes that you could easily get out of paying if you were 1099.

People talk about things like health insurance but that's something that you do have to pay for if you sign up for it. In many instances it is nothing more than a discount program in the event that you have to use it. Healthcare is a for-profit business that you must pay to play.

 

Yeah and another thing, don't get your tax advice from random truck drivers on the internet if you're 1099. It's asking for trouble. There are professionals who can guide you on that.

 

Hmmmmm. I'm surprised that your school recommended a 1099 company to you right out of the gate. The other members pretty said everything you need to know by advising you to leave that alone. All that being said, I am of the opinion that 1099 companies have a place in the industry even though the way they do things are illegal. I think that's a decent path to rehab your career should you end up with blemishes on your driving record or criminal record. I did it for a period of time to rehab my career. Some drivers want to be outlaw so badly they stay with those companies even though they can go to a reputable company, simply because many 1099 companies run by their own rules. I advise drivers to get their records cleaned up, and get out of the 1099 mold. That really isn't a way to make a career. That being said, your first year may be a little to the slow side in terms of your pay, but afterwards, there will be plenty of companies to work for without having to go the 1099 route, and you'll be able to make really good money if you have reliability and availability.

 

With all of the above info in mind.....give us your current zip code....and also what CDL endorsements you have, if any (tanker, hazmat...and/or doubles/triples)....and the Forum here will help you find a REAL cdl job.....

-- L

 

So you haven't ever been involved with an IRS audit as a 1099?

I have and they will tell you this single word when it comes to deductions - "disallowed" and they will figure out how much you owe.

Been there, had it done.

 

You think people pay taxes because they enjoy it? Maybe people obey the speed limit because they don't have any appointments or don't want to get anywhere?

The IRS will eventually find people that owe income tax just before the 3 year deadline when the penalties & interest are at a maximum. Ask me how I know. I made a mistake and underpaid taxes by $300. When the IRS discovered it I wound up paying them $3k.