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Phillip B, EA
Phillip B, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 630
Experience:  Practicing since 2004. Expert in 1040, small business, represent vs. IRS, & int'l tax mattters.
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I have an EIN for a sole-proprietorship trucking company for

Resolved Question:

I have an EIN for a sole-proprietorship trucking company for which I never did a final tax return on. We simply just quit the business for struggling economic times back in 2009. We also had some trouble with IRS because brokers were erroneously sending us 1099 forms for income we did not earn with them due to our business name being the same as another trucking company in another state. We are planning to open up a new trucking company sole-proprietorship again this coming year. Should I file for a new EIN if I want a new business name? or can I just use the same previous EIN and do a name change?
Submitted: 10 months ago.
Category: Tax
Expert:  Phillip B, EA replied 10 months ago.
Thanks for using JustAnswer.com! I will do my best to provide you with a clear and concise answer to your tax question based on the information that you have provided.

You actually only need a EIN as a sole proprietor if you are going to have employees, if you are not going to have employees you may as well use your SSN. If you need a EIN, I would get a new number for your new business.

If there are additional questions, please reply to this answer so that I can assist you further. If this answers your question, please rate my performance between OK and Excellent so that I can receive credit for my work. Thanks for your business.
Customer: replied 10 months ago.

What can I do to have my drivers be treated as contractors (issue them a 1099-MIsc) instead of employees. I know what IRS guidelines say as far as who is considered an employee and who is considered a contractor: if they don't have control over the type of work, how, where and when the work will get done, then they are an employee.


 


I know there are trucking / transport companies who legally issue out 1099Misc forms to their drivers and drivers don't own their tractor unit, its the company's that hire them. But I remember I read somewhere that to legally qualify to issue out a 1099Misc, or treat a driver as a contractor, it boils down to how the hire contract is written at time of employment ?

Expert:  Phillip B, EA replied 10 months ago.
With the IRS, ownership of the trucks, responsibility for the trucks upkeep, and control of the drivers time and schedules will be major factors in determining whether an employment or contractor relationship exists.

If the cost/ownership burden lies with you, the IRS would likely seek to classify all drivers that use your trucks as employees. If there is more of a lease/rental arrangement between you and your drivers for the drivers to use your trucks, a contractor relationship may be easier to justify.

Let me know if this helps.
Customer: replied 10 months ago.

If there is more of a lease/rental arrangement between you and your drivers for the drivers to use your trucks, a contractor relationship may be easier to justify.



Can you give me an example of a lease/rental arrangement between me and the driver? How would I need to word the contract in a case like that? Or is there a specific contract I would need to use?

Expert:  Phillip B, EA replied 10 months ago.
The wording wouldn't be the issue regarding the IRS here. The IRS will look at the facts and circumstances (who pays, controls, and is responsible for what portion of the business) of the business arrangement.

For example, a trucking company may rent their trucks to drivers for a certain amount every month and the drivers pay the expenses of upkeep and maintenance. The company provides the loads/routes but takes a certain percentage of the income as a administrative fee for providing the driver with the loads.

Let me know if this helps.
Phillip B, EA, Enrolled Agent
Category: Tax
Satisfied Customers: 630
Experience: Practicing since 2004. Expert in 1040, small business, represent vs. IRS, & int'l tax mattters.
Phillip B, EA and 6 other Tax Specialists are ready to help you
Expert:  Phillip B, EA replied 10 months ago.
Is there anything else I can do for you, or anything that I can clear up?

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