W2 vs 1099 for a company driver?

There is no benefit to a 1099 company driver job...your boss is screwing you and I don't care what anyone else has to say...so there.

Hurst did make a good case for it somewhere around here at one time though.

 

Save ya self the headache, avoid workin on a 1099..

 

Hi 77, BINGO. NOTHING good about a 1099. I never was able to make my quarterly taxes, and incurred the horrors of penalties and interest. They (IRS) have no sense of humor either. I heard a lot of companies are going that way, making you an independent contractor,(possibly, without you knowing it) and get out of a lot of accountant fees that way. Let the driver F with it.

 

A 1099 job sucks big time, I have done it once myself, and ONLY ONCE. not only are you responsible for your taxes, but any health benefits as well.

You really HAVE to put money aside for taxes, and I do believe pay quarterly, and NO, if you over pay on your taxes do you get it back either. You'll probably get money back at the end of the year,

But here is the rub.

If you do not have any health benefits, YOU WILL PAY a health care tax,(at tax time) I think around $400? for NOT having health insurance?

 

No workers comp on a 1099, can cost up to $5000 a year depending on state. You get screwed and guess who pockets the $5000

 

No benefits, no work comp, pay 15% self employment tax, pay your own health care, pay your own liability (and business) insurance, retirement, etc, and no unemployment insurance, either.

On the pro-side, lots of things can become a tax deduction when you are truly a business, but it takes a LOT to make up for what you give up.

 

Your Health Care Tax is based on your income. Some could get fined well over $400.00

 

I've worked under good and bad 1099 "conditions".

The only advantageous condition to work under a 1099 as a company driver would be if the company is offering substantial compensation to do so.

If you dont have any 'skeletons' I would advise against it. Its not for the faint of heart or novice to play around with. How ever if you do and are having difficulty finding regular work,.. then 1099 should not be ruled out.

You will need to register for an EIN# for the IRS and you will need to pay your own taxes. You can not work under a 1099 and expect to keep all the money paid to you. This is why you need to be paid a salary above and beyond current market scale to make working on a 1099 feasible.

There will be here on the forum who come in and say its illegal. For the most part I will agree,.. but for you to be hired and employed as a 1099,.. no. Not on your end. For the company to hire you as a contractor paid 1099, while only working as a driver,. yes,.. thats illegal. The worst that would happen is the company gets audited and fined. Reality is,.. you can theoretically work like that for years unaffected as long as your declared income and taxes are paid and up to date. If you ever have plans to become an owner operator.. its one way for you to learned how to pay and file taxes as an owner operator with out the expenses associated.

With a decent company you can easily gross $1600 - $2000 a week. Bare in mind,. at minimum 30% of that will be owed to IRS. If you hire on as a 1099 and keep all of the money paid,.. dont come back 2 yrs from now and whine that you feel 'cheated'.

Hurst

 

One of the first question that I would ask a perspective employer, "you pay under a W-2 or 1099"? If the answer is 1099, I don't want the job. A driver is placing himself in one big danger zone when he is paid under a 1099. Unless you have insurance to cover you, you better hope that you are never involved in an accident, because legally, you have no protection from any type of liability lawsuits, plus if you are injured you could "foot" all the medical bills. In other words, you are "on your own". All this is above and beyond the tax issues.