Every state has its own set of rules for commercial vehicles, so drivers must be aware of this while traveling across state lines. Ultimately, it is up to the truck driver to understand and follow these regulations. By doing so, drivers can maintain the safety of everyone on the roads while avoiding potential fines or other penalties. You’ll also need to establish the appropriate legal structure for your business (e.g., corporation, LLC, sole proprietorship).
The specific type of trailer depends on the kind of freight you’re hauling. Dry freight requires a dry van trailer, for example, and cold freight like dairy and produce requires a refrigerated trailer (or “reefer,” as it’s known in the business). Heavy loads like logs, posts, and construction tools are typically truckers bookkeeping service carried on flatbed trailers (which aren’t enclosed). Depending on the type of freight you’re hauling, you may also need to invest in equipment like straps, chains, and tarps. I got into the industry when I was working as an accountant for friends who had just started their own trucking operation.
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If you lack expertise in these disciplines, surround yourself with reliable business partners who can help you manage income and expenses. Before commercial vehicles are allowed to haul cargo, carriers must prepare for one last set of requirements. In most cases, an investment of between $10,000 and $30,000 should be enough to cover the costs of insurance, vehicle down payments, permits, and state-specific expenses. In addition to a valid CDL (commercial driver’s license), owner-operators must also fulfill a number of requirements outlined by the FMCSA.
Fortunately, it doesn’t have to take up too much time or energy if you plan ahead. One of the primary problems with managing your small business accounting is the sheer amount of time and energy it takes. Running a trucking company alone is enough work to keep you busy, and trying to do both is a lot to handle at once. The IFTA is a way to redistribute the fuel taxes truck drivers pay in the lower 48 states and the 10 Canadian provinces. It ensures your funds go to the areas where you used your fuel instead of the ones where you purchased it. Because working in the trucking industry involves taking on significant risk, you’re often better off taking the time to form a limited liability company (LLC) or a corporation.
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As a truck owner, you’re also required to have a process agent or a person who will receive any court papers for you if you’re ever served. Each structure has advantages and disadvantages based mostly on liability and taxes, and it varies with each state. You might want to meet with an accountant to find out https://www.bookstime.com/ which structure best suits your business. Most accounts receivable factoring companies that claim to offer non-recourse factoring only do so under particular circumstances. For example, your customer must file for bankruptcy between when you submit your invoice and when your customer is supposed to pay it.
It also covers some of the more complex topics you’ll want to understand, like compliance with government regulations and navigating the up and down trucking market cycles. Hiring good drivers and retaining them will play a key role in the growth of your trucking company. Therefore, it’s highly recommended that you have a thorough strategy for driver recruitment, driver satisfaction, and driver retention. It also mandates you to file fuel use tax returns quarterly in the state your business is based in.