HI ALL,
THIS IS AN ARTICLE THAT I SENT INTO EXPEDITERS ONLINE TO BE PUT INTO THE NEWSLETTER BUT IT SEEMS THAT I NEVER RECEIVED AN ANSWER AS TO WEATHER IT WAS GOING TO POST OR NOT.
THIS ARTICLE IS FOR ALL EXPEDITERS, TRUCKERS, OR ANYONE WITHIN THE TRANSPORTATION INDUSTRY AND IT WOULD HAVE TO DO WITH TAXES AND WHAT YOUR BOTTOM LINE IS.
THE ARTICLE IS CALLED THE 3 WAYS TO LOWER YOUR BOTTOM LINE
We all agree that there's nothing more frustrating than compiling the dreaded federal tax return. Every April, year in, year out, it's the same brain numbing exercise; gather up the receipts, sort them, total them, compile the tax return, pass out, regain consciousness, then, for one fleeting instant, consider charging the amount owed on your only credit card that has been maxed out.
Fear not. There are a few things you can do to throughout the year to help ease the success of the tax fling season, and at the same time increase your profits. Lets look at them buy the numbers.
1. Save every receipt you can get your hands on. Even the ones from the local post office, gas station, department and grocery stores. These little wads of paper you casually stuff into your pocket or roll into a wad and toss on the floor can save you thousands in tax dollars. Make sure your tax preparer gets each and every one of them.
Any tax person preparer/Bookkeeper will charge you for sorting and getting all your receipts together normally at the rate of anywhere between $35.00 to 75.00 or more per hour, depending on who he is.
2 DEFINITLY DON’T THROW THAT LOGBOOK AWAY! It’s the easiest way for you to check count the number of days that you are away from home while your on the road so you can figure the Diem Pay Deduction. Each day gives you $40.00 in US, & $45.00 in Canada/Mexico, that is after September 30, 2002( the rate prior to Sept 30, is $38.00 and $40.00. of which you receive 65% as your deduction from your Income tax on either your Schedule C- for sole proprietor’s, 1065, Partner’s return, or 1120 Corporation return.
An Example of this is, if you are away from home for 300 days, which is multiplied times $40.00 would equal $12,000.00, subject to the 65% clause, your netted IRS deduction is $7,800.00. That is a big chunk of dollars not to sneeze at coming off your business tax return. Bringing your net to new lows.
3. If you don’t know what you’re doing when it comes to income taxes, get someone who does. It doesn’t have to be a professional tax preparer, or certified public accountant, even though in most cases, they will save more in taxes than you’ll ever spend on there fees. It can be anyone, husband, girlfriend, wife, brother, sister, or just a good friend, whatever!. The main idea, is to make sure whoever prepares your tax return that they know approximately more than 95% of the trucking industry of what you can deduct.
HOW CAN YOUR TELL IF YOUR TAX PREPARER KNOWS ABOUT TRUCKS, AND THE TRUCKING INDUSTRY????.
The first thing you should do is ask him a few question like, Have you ever driven a Truck or know what’s involved in the trucking industry?. Do you know what a lumper is?, How bout a Load Locks?, Can I depreciate my truck over a three- or five- year period? If he answers anything but what you know as a driver for the first 3 items. The Standard Mileage Deduction, and 5 years for depreciation of your tractor, “RUN”. ( You better know the answer to the first three. If not, you are in deep trouble!, You are probably going to be audited, owe additional tax, plus penalty and interest, and If you call him, he might!, THAT IS MIGHT return your call.
Tractors and Straight Trucks over 26,000 lbs GVW. are listed in the Class Life Table of the depreciation instructions as 00.26, and have a class life of 4 years but, depreciated over 3 years.
Trailers, trailer mounted containers, flat beds, refrigerated trailers are listed as 00.27 and are listed as 6 year life and 5 yeas depreciated.
Straight Trucks listed between 13,000 lbs & 26,000 lbs GVW, are listed as Class 00.242, with a life of 6 years and depreciated over 5 years. This includes bucket trucks, & straight trucks
Cut Away Cargo Vans & light trucks with a 10-16 ft box, who weight between 10,000 and 13,000 lbs loaded GVW are listed as 00.241, with a 4 year class and over 5 years that they can be depreciated.
Cargo Vans, Automobiles, and Pick-up Trucks, can take the Standard mileage deduction. But, If you decide to take actual expenses and not the standard mileage deduction you are only allowed to depreciate the vehicle for 5 years, with a 3 year life and listed as 00.22.
The lax of tax knowledge, not taking all the deductions you are entitled to, and money management, are the three biggest reasons that Drivers fail in the first two years of business. Winding up going bankrupt, or in other financial situations. Even though every driver knows how to be creative and wheel and deal for a load. But tax computation is something that you should leave to the professional that knows the trucking industry.
DO YOU DISAGREE?, WOULD YOU LIKE TO BET YOUR TRUCK ON IT????
By: Franklin Katz
Frank’s Tax & Business Service,
www.1040.com/Frankstax
www.Tax-directory.com/NC/Frankstax.html
704-739-4039,
Fax: 704-739-3934
THIS IS AN ARTICLE THAT I SENT INTO EXPEDITERS ONLINE TO BE PUT INTO THE NEWSLETTER BUT IT SEEMS THAT I NEVER RECEIVED AN ANSWER AS TO WEATHER IT WAS GOING TO POST OR NOT.
THIS ARTICLE IS FOR ALL EXPEDITERS, TRUCKERS, OR ANYONE WITHIN THE TRANSPORTATION INDUSTRY AND IT WOULD HAVE TO DO WITH TAXES AND WHAT YOUR BOTTOM LINE IS.
THE ARTICLE IS CALLED THE 3 WAYS TO LOWER YOUR BOTTOM LINE
We all agree that there's nothing more frustrating than compiling the dreaded federal tax return. Every April, year in, year out, it's the same brain numbing exercise; gather up the receipts, sort them, total them, compile the tax return, pass out, regain consciousness, then, for one fleeting instant, consider charging the amount owed on your only credit card that has been maxed out.
Fear not. There are a few things you can do to throughout the year to help ease the success of the tax fling season, and at the same time increase your profits. Lets look at them buy the numbers.
1. Save every receipt you can get your hands on. Even the ones from the local post office, gas station, department and grocery stores. These little wads of paper you casually stuff into your pocket or roll into a wad and toss on the floor can save you thousands in tax dollars. Make sure your tax preparer gets each and every one of them.
Any tax person preparer/Bookkeeper will charge you for sorting and getting all your receipts together normally at the rate of anywhere between $35.00 to 75.00 or more per hour, depending on who he is.
2 DEFINITLY DON’T THROW THAT LOGBOOK AWAY! It’s the easiest way for you to check count the number of days that you are away from home while your on the road so you can figure the Diem Pay Deduction. Each day gives you $40.00 in US, & $45.00 in Canada/Mexico, that is after September 30, 2002( the rate prior to Sept 30, is $38.00 and $40.00. of which you receive 65% as your deduction from your Income tax on either your Schedule C- for sole proprietor’s, 1065, Partner’s return, or 1120 Corporation return.
An Example of this is, if you are away from home for 300 days, which is multiplied times $40.00 would equal $12,000.00, subject to the 65% clause, your netted IRS deduction is $7,800.00. That is a big chunk of dollars not to sneeze at coming off your business tax return. Bringing your net to new lows.
3. If you don’t know what you’re doing when it comes to income taxes, get someone who does. It doesn’t have to be a professional tax preparer, or certified public accountant, even though in most cases, they will save more in taxes than you’ll ever spend on there fees. It can be anyone, husband, girlfriend, wife, brother, sister, or just a good friend, whatever!. The main idea, is to make sure whoever prepares your tax return that they know approximately more than 95% of the trucking industry of what you can deduct.
HOW CAN YOUR TELL IF YOUR TAX PREPARER KNOWS ABOUT TRUCKS, AND THE TRUCKING INDUSTRY????.
The first thing you should do is ask him a few question like, Have you ever driven a Truck or know what’s involved in the trucking industry?. Do you know what a lumper is?, How bout a Load Locks?, Can I depreciate my truck over a three- or five- year period? If he answers anything but what you know as a driver for the first 3 items. The Standard Mileage Deduction, and 5 years for depreciation of your tractor, “RUN”. ( You better know the answer to the first three. If not, you are in deep trouble!, You are probably going to be audited, owe additional tax, plus penalty and interest, and If you call him, he might!, THAT IS MIGHT return your call.
Tractors and Straight Trucks over 26,000 lbs GVW. are listed in the Class Life Table of the depreciation instructions as 00.26, and have a class life of 4 years but, depreciated over 3 years.
Trailers, trailer mounted containers, flat beds, refrigerated trailers are listed as 00.27 and are listed as 6 year life and 5 yeas depreciated.
Straight Trucks listed between 13,000 lbs & 26,000 lbs GVW, are listed as Class 00.242, with a life of 6 years and depreciated over 5 years. This includes bucket trucks, & straight trucks
Cut Away Cargo Vans & light trucks with a 10-16 ft box, who weight between 10,000 and 13,000 lbs loaded GVW are listed as 00.241, with a 4 year class and over 5 years that they can be depreciated.
Cargo Vans, Automobiles, and Pick-up Trucks, can take the Standard mileage deduction. But, If you decide to take actual expenses and not the standard mileage deduction you are only allowed to depreciate the vehicle for 5 years, with a 3 year life and listed as 00.22.
The lax of tax knowledge, not taking all the deductions you are entitled to, and money management, are the three biggest reasons that Drivers fail in the first two years of business. Winding up going bankrupt, or in other financial situations. Even though every driver knows how to be creative and wheel and deal for a load. But tax computation is something that you should leave to the professional that knows the trucking industry.
DO YOU DISAGREE?, WOULD YOU LIKE TO BET YOUR TRUCK ON IT????
By: Franklin Katz
Frank’s Tax & Business Service,
www.1040.com/Frankstax
www.Tax-directory.com/NC/Frankstax.html
704-739-4039,
Fax: 704-739-3934