No experience but getting Authority

Congrats Red on the Safety Audit, I had to do mine with in about 3 months of getting my authority, I cant recall what the timeline was (6 months?) but i was happy to get it over with certainly! Newguys -If yours is coming up, dont be nervous just have what they ask for when they get there, they are not looking to shake you down.

Side note, I had it done at my home office with a beautiful mid twenty ish DOT officer, the pleasure was all mine. She was very professional and it went off without any major issues.

The issues I had; was the driver I had classified as an employee and she questioned me about my drug testing program, which I was doing through the local intermediate care place in my hometown. She suggested i use a company such as Foley. I still do not agree, as long as my program meets the requirements.

Secondly was the driver classification; contractor or employee. 1099/1040 or W2. Im sure lots of guys have opinions of this, and I know the IRS sets the classification rules etc. I know the deal.

RED - Now that your a fleet owner whats your position on employee classification? What if that new drivers requests your structure your agreement as independent contractor? Ie, he decides when, where, loads, home time, etc? Or are you going to get into a formal payroll system with w2?

I do use a certain firm that issues me a CSA for commercial fleets and a fleet safety compliance manual. Just trying to keep up with Regs is a full time job.

For tax purposes if your LLC is a sole owner then you can treat your LLC as a sole proprietorship and take profits as needed and 1040 yourself every year, although you cannot expense yourself.

My goal is to run three trucks, I have 2 now - one needs an overhaul due to being run hot for 30 minutes trying to get it to the next town. Im still PISSED about that, MAKE SURE ALL YOUR TRUCKS HAVE AUTOSHUTDOWN.

 

Does anyone know about the safety audit in Pennsylvania? I can't find any info on who does it and where it takes place.

 

Thanks Jopper. Exactly my experience on the latter. The guidance I've seen is 6-18 months. Yours came in pretty quick.

The officer that audited me was a woman about my age. She went the extra to point out and try to help with what was obviously a PA officer with a hard-on back in May. Totally professional and very helpful. At the same time, if I was a bad guy I wouldn't try her. Especially if she was toting a 3-cell maglite LOL.

Might have been from the standpoint of them being a known, end to end supplier on the process and document package. We're using ICMI and she smiled and remarked about us being with OOIDA when I handed her the folders. She still pulled out the contents and examined each page.

In my opinion (just how I see it, and I'm no tax attorney), a true contractor would need to have control over their schedule. The drivers I have do not. My son has been a W2 employee since day 1. Since incorporating, everyone is a W2 employee, including yours truly.

Until this year, I did my own payroll taxes. It's stressful to keep up with and my bank offered the service at a fair price. Starting Jan 1., they handle it. On Tuesday I enter everyone's pay detail and on Friday they get paid via ACH. No muss no fuss. The bank handles all the withholding deposits and whatnot. I get an overnight package on Thursday with a printed statement and paystubs I can either stamp and mail, or hold for the driver to pick up when they come through.

I'm too cheap to subscribe to that sort of compliance service. I'll order a new big green book every year and keep up with the news in the dozen or so industry rags I get in the mail or my e-mail.

On the paying yourself part, I can do the same thing with my c-corp. As the president and director, I call a board meeting with the other director (Mrs. Foreman) and we decide to issue a dividend. To date, with our break-even business model, I have no need to call that meeting since there is no money to pay in dividends.

My longer term goal is to make enough profit to live comfortably and keep paying my bills on time. Maybe someday I'll even entice a few occupy protesters to camp on my lawn to whine about me not paying my fair share of taxes.

Two trucks is all I can stand right now. This in terms of financial resources, available business, and my personal workload. I will not add a third until the first two are more consistently loaded AND there is a customer or two with capacity to at least load the third one 40-50% of the time. When those two conditions are met, and when I have an extra $50k to spare and buy/recondition the new hardware, I'll consider adding one more.

On the overheating, my plan is to equip my trucks with a driver that can read the warnings and get off the road at the first sign of trouble. Please don't take that as a second guess on what happened. I'm sure there's more to the story. The only way my driver would still have a job after that would be: where he called in to report the overheating immediately after shutting down at the first available place to stop, and then I directed him to continue running it hot to make the delivery.

 

We got one at the mm 246 rest area off I-80.

I expect that the PA State Police CMV enforcement will contact you at some point and schedule a date. Call them and they'll probably tell you exactly what to expect.

 

I've been lurking on here for about 2 years and didn't bother to even register until recently. Point is, I've been following your posts and many others who are a wealth of information and I really appreciate it. I suspect there are a lot of other people who look on here for information and never post, either. Thank you to all the owner/ops on here for sharing your knowledge and experiences as I'm about to pull the trigger on getting my own authority and this forum has been helpful.

 

I can answer this (came up in my audit). Small groups have two issues. First is the gaming of the system. Most small groups do quarterly random tests. So an independent O/O will have 90-days to get clean if they are called in for random.

Second is that they have a high rate of falling out of compliance (above reason is big cause) BUT you as a part of the group may never know that until you get audited and are fined for not having a qualified random testing program. IT IS YOUR RESPONSIBILITY TO MAKE SURE THE PROGRAM IS COMPLIANT BUT YOU HAVE NO WAY OF FIGURING IT OUT UNLESS YOU REALLY UNDERSTAND THIS STUFF.

What I have learned is you want to be in one that is set-up for trucking first. Other industries may not have same guidelines.

 

thanks guys great info Good Luck, I hope we all have a solid 2012.

RED- That cracked me up, I honestly can not come up with a scenario where engine damage due to an overheat is not driver error. When i asked how long he drove it hot, O about 30 minutes was his answer - I responded with thats 29 minutes too long. Nothing worse than heat for an engine, even running it out of oil is better.

 

Hey there Red, thanks so much for the update. Your experience is the model for anyone who is considering a venture like this. Just a suggestion, and you may want to check with a corporate Attorney about this, but if I remember correctly as a "C" corp you need to be especially certain that you have all the required meetings, regardless of whether you have any business to consider or not. The minutes need to be in that corporate book and it needs to be up to date. Attorneys are real good at finding that crack in the corporate veil! The way you're organized, though, sounds like you'd be ready for that if the mess ever hit the fan...

PS, Don't forget that board meeting... you know, the one where there is "no new business to consider"... could be in your mini-suite in Bermuda!

 

Good luck to you and your dreams! I am in the process of doing the same thing!

 

Red, would you be willing to share any of this with someone in the process of setting up? I've been avidly reading your thread here and some other threads through out and lurking about to gain as much wisdom as is possible. I love how so many people are willing to share the good and the bad to help everyone out.
Lakes