If you have recently opened a small trucking company, you’re probably overwhelmed with finding people to perform all of the services for your operations.
You have to find someone to handle compliance for you, you need an insurance provider, Tax Preparer, and you must find someone to plan your routes. Truckers are expected to pay lots of taxes, and most pay them quarterly.
According to Simplex Group – Tax Preparation & Filing, during your first year of operations, an auditor from the Federal Motor Carriers Safety Administration will visit your company to perform your new entrant audit. They will expect your tax records to be filed electronically. If they’re not, you could potentially fail the audit.
You will need a professional accountant or tax preparer to file your taxes. Knowing what to look for in a tax preparer can be rather confusing.
No business wants to hire an accountant who is straight out of college. Whenever you hire an accountant or tax preparer, you should make sure that they have been in business for at least several years.
More to the point, you should look for a tax preparer with experience in the trucking industry. Even independent truckers must pay self-employment taxes for Social Security and Medicaid.
Filing taxes for a trucking company can be complex. The amount of taxes you pay will be determined by everything from your business entity type to the states through which you will travel.
For example, if you travel through New Mexico or Oregon, you will pay more taxes than trucking companies who do not travel through those states.
A person who handles trucking taxes will have to be familiar with the International Fuel Tax agreement as well. The agreement allows truckers to pay their fuel taxes through one office rather than paying taxes to every state they travel through.
Their local office will collect the tax and distribute it to the various states.
The IFTA report must be filed right on time. If not, you may face heavy fines. Your tax preparer must understand the law and get everything done on time.
Some companies provide multiple services to truckers, such as compliance and trip planning. It’s best to find a compliance company that also offers tax preparation.
That way, the preparer is certain to understand what the FMCSA and the IRS are looking for.
What Do Their Existing Customers Have To Say
A tax preparer should be able to provide you with references. Internet reviews are not enough.
They may be written by people who work for the accounting firm or by people who write them. You should always try to get a reference from a business around the same size as yours.
What Questions To Ask
Before you hire any tax preparer, there are a few questions you should always ask.
1. How Do You Determine What You Will Charge Me?
It’s good to know how much you will be charged to compare them to other tax preparers. It’s also important to know what tax preparation will cost annually.
2. What happens if I get an IRS audit?
A person who prepares your taxes should take responsibility for their work. If you’re audited by the internal revenues service, the tax preparer should be able to answer any questions the auditor has. You should never be fined for a tax preparer’s mistake.
3. When will you complete my tax forms, and will I get to review them?
Whenever you do business with anyone, you should ask when you can expect the work to be completed. Tax preparers can become overwhelmed with work, and if they think they can take their time with your account, they just might.
Nobody enjoys paying taxes. However, hiring a qualified tax preparer who knows something about the trucking industry will give you one last thing to worry about.