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The freight market has been navigating rough waters lately, creating challenges for many owner-operator truck drivers. The upcoming 2024 election adds another layer of uncertainty, with hopes pinned on a potential market rebound post-election. However, it’s important to recognize that regardless of the election outcome, the freight market won’t transform overnight. Policy changes and economic shifts take time to ripple through the industry, making immediate improvements unlikely. Instead of waiting for the market to rebound, there are proactive steps you can take now to regain control, and positively impact your trucking business: 1. Diversify Your Freight Options Diversifying the types of freight you haul can be a game-changer. Instead of sticking to familiar routes and cargo, explore new opportunities in industries less affected by economic fluctuations. Consider looking into routes in areas of the countries that others aren’t willing to run through, as well. For example, taking on freight that others may shy away from, such as routes into the heavily populated Northeast, can set you apart from the competition. By being willing to haul in areas that are more challenging, or less popular, you can tap into a niche market with potentially higher demand. 2. Enhance Fuel Efficiency Fuel costs are one of the most significant expenses for truck drivers. By implementing fuel-saving practices, you can achieve substantial cost reductions. Regular vehicle maintenance, proper tire inflation, and adopting fuel-efficient driving habits are just a few ways to lower fuel consumption. Investing in fuel-efficient technologies, such as aerodynamic add-ons and low-rolling-resistance tires, can further increase savings. 3. Leverage Technology Embracing technology can give you a competitive edge. Utilize apps and software for route optimization, load matching, and real-time tracking to find the best loads, reduce empty miles, and improve efficiency. Telematics systems offer valuable data on vehicle performance and driver behavior, enabling informed decisions that can boost your business’s bottom line. For more resources, see our lists of the best fuel savings cards and apps  and the best overall apps for owner-operators  to maximize your efficiency and savings. 4. Focus on Customer Relationships Building strong relationships with your customers is key to ensuring a steady flow of business. Providing reliable service, maintaining clear communication, and going the extra mile can make you the preferred choice for shippers. Loyal customers are more likely to provide repeat business and refer you to others, creating a stable foundation for your operations. 5. Optimize Your Financial Management Effective financial management is crucial in navigating tough market conditions. Keep detailed records of income and expenses, create a budget, and monitor cash flow closely. Working with a financial advisor specializing in the trucking industry, like our team at ATBS, can help you make informed decisions. Reducing fixed costs, such as by renegotiating insurance premiums or leasing agreements, can further stabilize your finances. 6. Stay Informed and Adapt The freight market is ever-changing, so staying informed about industry trends is vital. Engage with industry associations, read trade publications, and attend webinars like our ATBS Independent Contractor Benchmarks and Trends Driver Webinar on September 18th , to stay current on the industry. Being adaptable and willing to pivot your business strategy can help you weather market fluctuations. Networking with other truck drivers and industry professionals can also provide valuable insights and support. 7. Invest in Professional Development Continuous learning and professional development keep you competitive. Whether it’s understanding new regulations, learning about truck technology advancements, or honing your business skills, investing in your growth can yield long-term benefits. Earning certifications in safety, compliance, or specialized freight can also enhance your marketability and unlock new opportunities. While the freight market’s future remains uncertain, owner-operators can take concrete steps to strengthen their businesses. By implementing these strategies, you can navigate current challenges and position yourself for long-term success, regardless of the political landscape.

At ATBS, we understand that sometimes it can be difficult to find your routine. We know that as an owner-operator, your days and weeks can look very different. However, here are the Top 10 Things an Owner-Operator Should Do Every Day! 1) A Pre-Trip Inspection of your rig. Not only is it mandatory, but it's a great way to start your day. 2) Make the bed. It makes everything look cleaner, and it's an easy thing to accomplish first thing! 3) Plan your meals and snacks for the day ahead of time. Remember to include healthy snacks like fruits & veggies. 4) Map your route and fuel stops. Since fuel is such a big expense, this is a great opportunity to keep more of your hard-earned money! 5) Smile when greeting your dispatcher, a toll booth operator, or even the TA clerk working the register. 6) Plan to move. Seek out a place to walk at the truck stop, find a workout facility nearby, or do a quick workout in the truck. 7) Buckle up! 8) Reach out to your loved ones. Using a headset of course! 9) Send the day's receipts and track your Per Diem in the ATBS Hub . 10) Drive carefully!

Establishing a Limited Liability Company (LLC) can offer a layer of protection and professionalism often sought in the transportation industry. From the perspective of liability, tax implications, and branding, structuring a business as an LLC has significant advantages for truck drivers. This article will provide a roadmap to establishing an LLC, detailing the pivotal steps involved and other crucial setup tasks to consider, guiding you through the journey of turning your truck driving operation into a formal business entity. Are you a self-employed truck driver who needs help forming your own business entity? Click here! The Benefits of Starting an LLC for Truck Drivers Starting an LLC (Limited Liability Company) can offer significant advantages for truck drivers and trucking businesses within the trucking industry. Below are some benefits of forming an LLC: Limited Liability Protection An LLC safeguards the personal assets of a truck driver, protecting them from the risks associated with business obligations. This means in the event of business debts or legal action, personal properties such as a driver’s home or personal savings would typically not be at risk. Tax Flexibility With an LLC, truck drivers have the ability to choose the most advantageous tax structure for their financial circumstances. They can opt for pass-through taxation, where profits are reported on personal tax returns, or elect to be taxed as a corporation if it benefits their financial goals. Credibility and Professionalism Establishing an LLC conveys a strong message of dedication to responsible and compliant business operations. For trucking companies, this level of professionalism can be pivotal in attracting clients and securing contracts, as it suggests a commitment to legitimacy and stability. In sum, an LLC provides essential shields and options for truck drivers and their businesses. This makes it a compelling choice for those in the trucking industry seeking to establish or grow their operations. Steps to Start an LLC Starting a Limited Liability Company (LLC) within the trucking industry involves several important steps: Choose a Base State Identify the state in which your LLC will primarily conduct its trucking business. This decision should consider tax structure implications and operational convenience. Name Your LLC Carefully select a unique and compliant name that meets state requirements and reflects your trucking business. Designate a Registered Agent Appoint a responsible party or service within your base state to receive legal documents on behalf of your LLC. File Articles of Organization Submit the necessary formation documents to the state office, outlining key details about your trucking company. Obtain an EIN Apply for an Employer Identification Number from the IRS, which is necessary for tax purposes and to hire employees. LLC Operating Agreement Draft an agreement that details the ownership structure, member roles, and operation procedures of your trucking business. By following these steps methodically, entrepreneurs in the trucking industry can establish a solid foundation for their company under the protective structure and flexible tax benefits of an LLC. Other Important Setup Tasks Starting a trucking business requires more than just registering your company as a limited liability company (LLC). After determining the appropriate tax structure and formalizing the entity, there are several other critical setup tasks that must be addressed to ensure operational readiness and legal compliance. Business Bank Account Setting up a dedicated business bank account is vital for managing finances, tracking expenses, and maintaining the financial integrity of your trucking company. This separation from personal finances also supports the limited liability status, helping to protect personal assets. Licenses and Permits Your trucking business must acquire the necessary licenses and permits to operate legally within the trucking industry. This may include a Commercial Driver's License (CDL), motor carrier operating authority (MC number), and various state-specific permits. Insurance Coverage Obtaining adequate insurance coverage is essential for protecting your business from potential risks. Required insurance may include liability insurance, cargo insurance, and coverage for any non-owned trailers. These foundational steps create a stable platform for your LLC trucking company to operate within the broader framework of the trucking industry. Tax Options as an LLC After forming an LLC, the business will have the option to be taxed as a C-Corporation, an S-Corporation, or neither and file as a Disregarded Entity, where the business income and expenses are reported on the owner’s personal tax return on a Schedule C. By electing to be taxed as a C-Corporation the business would be required to pay corporate income taxes and the shareholders would be required to pay individual income taxes on the wages and dividends that are distributed by the business entity. This is known as “double taxation” and makes this election unwise for any small business. A great option for a trucking business may be for the owner(s) to elect for their LLC to be taxed as an S-Corporation. The S-Corporation is considered a pass-through entity. This means the income is not taxed at the corporate level and the profits are distributed to the shareholders who pay tax on the percentage of business income allocated to them at the individual level. The individuals are responsible for paying income taxes but they do not pay self-employment (Social Security and Medicare) taxes on distributions. It’s important to note that S-Corporations are required to run regular payroll and pay themselves a W-2 wage. This should be deemed reasonable compensation, which the IRS defines as the wages for a comparable individual in the same industry, with similar experience, and located in a similar location. And, you must file a corporate tax return in addition to your personal tax return. Depending on the level of consistent income, it may be a tax advantage for an LLC to elect to be taxed as an S-Corporation. However, if that income level is not high enough, an LLC electing to be taxed as an S-Corporation may cost more than the savings received in taxes. A general rule of thumb that ATBS suggests is if the business will produce a net income of $80,000/year or more there may be some tax savings being taxed as an S-Corporation. This chart is a simplified example comparing the taxes for an LLC taxed as a sole proprietorship and an LLC taxed as an S-Corporation. LLC - Taxed as a Sole Proprietor LLC - Taxed as an S-Corporation Income $90,000 $90,000 Wages - $50,000 Taxable Income $90,000 $40,000 SE Tax or FICA $13,770 $7,650 TAX SAVINGS $0 $6,120 Here is a free e-Book that goes into much more detail on the different business structures. The decision of whether or not to incorporate your business and file your taxes as an S-Corp should be based on detailed business and tax analysis by your accountant . If you have any questions or want more information, please call ATBS at 866-920-2827, or visit our website at www.atbs.com.

Electronic Logging Devices (ELDs) have been a heated topic lately among drivers, carriers, and the FMCSA. There are positives and negatives to each side, but the bottom line is that times are changing. Adapting to that change can be difficult, but it’s certainly possible. ELD Basics If the regulation is passed, ELDs will be mandatory for all drivers that are currently required to complete paper Records of Duty Status (RODS). Your carrier will be responsible for making sure the ELDs they provide have been registered with the FMCSA. Carriers will have 2-years from the date the mandate is passed to get ELDs installed in their trucks and ready to go. They may install them sooner rather than later to account for the extra training required for drivers during transition. Some notes about ELD and driver interaction: Driver should only log when the vehicle is stopped. Driver does not have to be prompted by the device when approaching a time limit. Driver will be prompted for entry if: If stopped for 5 minutes (will request duty status – the system will default to “on duty” if there is no driver entry). If no position is fixed at duty change (will request location). System must have a mute setting to be used when the driver is in the sleeper berth. ELDs can be programmed to alert the driver if the vehicle stops moving after 5 minutes (to confirm driving). Other automatic duty-status settings are prohibited. Roadside processes: You must be capable of producing a graph grid at a roadside inspection , or be able to print a copy of your log. There should be a one-step process for data transfer (either by web, Bluetooth, or email). The Upside of ELDs ELDs have the potential to make a driver feel as though they are constantly being watched. One positive side of this is that the driver will no longer have to fill out paper logs and worry about whether or not they are right, accurate, etc. This means less stress with tracking, and less chances for error. There will be an adjustment period, and maybe some initial frustration with flexibility. However, after a little time it could end up increasing the opportunity for a more stress-free work environment. Most importantly we have had many drivers and companies tell us that they ultimately became more productive, and drivers have made more money after ELDs were implemented. A great way to help adjust to this change is to make ELDs work for you, instead of against you. Some good advice comes from Jeff Clark – a former Team Run Smart Pro with Freightliner. “Be smart and plan. If you can take your 10-hour break at a shipper, then do it. The ELogs don’t start until you start them, either with a pre-trip or by moving the vehicle. Some regular customers might even allow you to open the doors and back into a dock overnight. Do whatever you can. With ELogs you become wary of starting your day too early. You don’t want to start your clock by driving to a shipper 2 hours before your appointment and waiting. Because of the 14-hour rule I now try to be there just 30 minutes early, instead of as early as possible.” You may have to change the way you handle your day and your schedule, but it is possible to make it work! Important Reminders Be sure to download your ELDs at the end of every month and save it to your computer. Create a folder on your desktop labeled “E-Logs”, then a new folder inside that for each year. Make a habit of saving each month of your E-Logs in that folder! Carriers are only required to save your logs for the past 6-months , so it’s important to maintain these records for yourself in case of a tax audit to verify and calculate your per diem days . The ELD change is inevitably coming, but how you choose to adapt to it will truly be what affects the outcome. Go into the change with an open mind, and make the effort to think positively. It will be an adjustment, and may be difficult at times. But working on it and making the effort to be flexible will make the change a little easier. Additional information and resources: http://www.regulations.gov (docket number FMCSA-2010-0167), here is a direct link to the rule where you can comment: http://www.regulations.gov/#!documentDetail;D=FMCSA-2010-0167-0972

By Jake Krough In order for me to get a better understanding of what life is like as a truck driver, ATBS sent me on a three-day road trip with longtime owner-operator and Team Run Smart Pro, Henry Albert. I started in the Marketing Department at ATBS in May of 2018. My day-to-day duties include running our social media accounts, writing blogs for our website, and sending out emails. This is my first job out of college and I started with little knowledge about the trucking industry. I have learned a lot during my time here. However, because my job is all about connecting with truckers, ATBS thought it would be a good idea for me to go out and experience life on the road. Obviously, in three days I was not able to get a complete understanding of what it is like to live on the road. However, I was able to learn a lot and leave with a greater appreciation for what truckers go through each and every day. Since I learned so much in my short time on the road, narrowing this down was difficult, but, here are the five most important things I learned while on the road for the first time. I learned about the patience that is required While being on the road, I quickly learned about the patience that is required to be a truck driver. Whether we were waiting at the shipper to get loaded, waiting in traffic, or waiting to go back on duty after the mandatory 10 hours off duty, it seemed like there were a lot of things that kept us waiting to get to our destination as quickly and efficiently as possible. When I was on the truck, we waited at the shipper for about 19 hours before we got loaded up, and that was with everything being on schedule. We got to the shipper at around 6:30 p.m. and didn’t get loaded until about 12:30 p.m. the next day. A lot of this time was spent either in the cab or in the break room at the shipper. Henry had hoped we would be able to get loaded a little early, but unfortunately, we were not able to. However, we were loaded up at our scheduled time, so I guess there is nothing wrong with that! I imagine there are many times truckers are having to wait past their scheduled load times due to delays at the shipper or receiver. We also had to wait quite a bit going through downtown Dallas and Austin due to traffic. Henry told me before we made it into Texas that there is never a good time to drive through Dallas and Austin because there is always traffic. Even with Henry letting me know about this, it was still surprising that Dallas had traffic at 11:30 p.m. Luckily the traffic wasn’t as bad as it could’ve been if we were attempting to get through downtown during rush hour. As a trucker, the chances of you going through multiple major cities a day is significant, which means your patience will be tested frequently. Even though the amount of time we had to wait during these three days was relatively mild, I was able to imagine how much truckers have to wait on a day-by-day basis and how much patience is required. I learned about the difficulty of parking During my time on the road, there were two situations that I got to see the difficulty that comes with parking. The first scenario came when Henry decided to reserve a parking spot at the TA Petro in Hillsboro, Texas. He knew that we wouldn’t get into Hillsboro until around 12:00 a.m. and by that time all of the spots could be taken up. So on this occasion, he reserved a spot ahead of time. Unfortunately, when we showed up there was still plenty of free parking available. I understand the safety in spending the money to guarantee a spot and not risking going over the on-duty time looking for one. However, I can see where truckers would get frustrated if they spend money on a reserved spot when open spots are available. I can imagine the little gamble a trucker goes through each day when deciding whether to reserve a spot or banking on one still being available. The second scenario came on my last day in the truck when Henry needed to drop me off near downtown San Antonio in order for me to get to the airport. It took some planning in advance to decide where Henry was going to be able to park and drop me off. Henry was not going to be able to drop me off right next to the airport because maneuvering was going to be too difficult. We decided on a drop-off spot about 20 miles south of the airport in an area that Henry was familiar with. Even though he was familiar, it was still a challenge finding a place that was truck accessible. Through this scenario, I learned that truckers aren’t always able to pull off wherever they want like the driver of a car can. I see the planning a trucker has to go through even when finding a place to park for a short period of time. I learned about how to run your own authority successfully Through the many conversations I had with Henry, the one that really stood out was our conversation about what it takes to run your own authority . Henry has run his own successful authority for over 20 years. The three things that he said were most important were acquiring customers, understanding freight rates, and being different. First, we talked about acquiring customers. Henry let me know the difference between getting loads through a load board and actually having your own customers that you are hauling for consistently. Henry said that the first step in acquiring customers is giving them a deal in price or time of delivery the first couple of times you haul freight for them. Once you have given the shipper a deal, you have to provide over-the-top service to the receiver. The service that you provide should be so good that they start asking the shipper specifically for you to deliver their freight. Once the receiver has asked about your services, you have the power to negotiate. Next, we talked about freight rates. Henry told me that in order to be successful you need to look at the total trip and not just one way. This means that it is okay to take a load that you just breakeven on if the load that got you there, or the one you will return with, will make you good money. He said it was better to take a load that breaks even than to turn down a load while waiting for “good” loads. Any time you are not running, you are losing money. Henry also said that it’s important to understand that freight rates are controlled by supply and demand and not operating costs. This means that the rates of 10 loads that one person wants are going to be a lot better than the rate of one load that 10 people want. I thought that was a good thing to keep in mind and it made me realize how owner-operators constantly need to be thinking like business owners. Lastly, we talked about being different. Being different allows you to separate yourself from the competition and be somebody your clients always go back to. What Henry does to be different is simply wear a tie. This way he looks presentable to his clients and people trust him with whatever he is hauling for them. It really only takes something that simple to separate yourself from the others. I learned about how advanced trucks are becoming Henry drives a 2018 Freightliner AeroX 72” RR Sleeper Cab. It had a lot of the new technology that has increased the safety and efficiency of driving a truck . Henry has been in the trucking industry for over 30 years and has driven many trucks with varying degrees of technology. A few of the features that really stood out was the adaptive cruise control, the radar system, and the lane departure warning system. Henry is able to set the adaptive cruise control to a certain speed with parameters for how much faster or slower than that speed the truck can go. The truck has a GPS that works with the adaptive cruise control so that it can plan it’s route rather than just react. For example, the truck doesn’t just react, and speed up, when going up a hill. Rather, it is able to see that a hill is coming and plan how to get up and over the hill with the best fuel efficiency . This usually involves speeding up the truck a bit early and putting the engine in “neutral” once it knows it can make it over the hill and down the other side. The two other features that really stood out was the radar system and the lane departure warning system. The radar system is able to track the vehicle in front of the truck and let Henry know how far away the vehicle is and how fast it is going. The lane departure warning system is similar to rumble strips on the road. Every time the truck was starting to go out of the lane it was in, the lane assist would make a beeping noise to warn Henry. It was amazing to see how the technology worked together in the truck and imagine where advancements could take it in the future. Even though the technology in the truck may make it easier to drive, you still have to understand the features and how to use them to your advantage. I learned that trucking is hard work Above all, I left the truck with so much gratitude for what truckers do. Simply put, trucking is hard work. Being on the road by yourself, away from family, driving every day, and having to put up with the stress of trucking would not be easy. Because I was on the road for only a few days, I didn’t really feel all of those struggles that truckers have to go through. However, I was able to imagine what it would feel like if you were on the road during the majority of the year. Even though I imagined how hard trucking would be, I also imagined how exciting it could be. If you are in a role that you love, traveling places you enjoy going, staying on a schedule that works best for you, and making good money from it, the hard work would be worth it. I can also imagine the thrill of starting as a company driver, eventually starting your own company and finally having a goal of owning your own fleet. Working toward a goal like that would make getting on the road every day a little bit better. I did learn how hard trucking can be but I also learned how truckers can make the hard work feel a little bit better. Final Thoughts I’m going to remember all of the things I learned while on my trip and keep them in mind so that I can apply it to my work at ATBS. This trip has allowed me to become more knowledgeable about the trucking industry and will hopefully allow me to connect better with truckers through email, social media, and our website. I want to thank Henry for allowing me to be on the truck with him for a few days and maybe one day I will have the opportunity to do it again.

As an owner-operator, it’s critical to understand the business structure options available to you and when each is most appropriate for your business. The legal form under which you set up your business can have a significant impact on how you run your business, the costs of running your business, and how you are taxed. Understanding the advantages, and disadvantages, of each entity is critical. The small differences in the way each entity is set up, managed, and taxed can make a huge difference to you and your business. In this article, we’ll discuss the four most common ways for truck drivers to set up a business: Sole Proprietorship Partnership Corporation Limited Liability Company (LLC) Sole Proprietorship A sole proprietorship is a business generally owned by one person. Most owner-operators will start with this type of business. Advantages: A sole proprietorship is the least expensive, easiest, and least regulated type of business structure. There is no formal setup and it begins when you start earning revenue as an owner-operator. In the eyes of the law, the owner of a sole proprietorship is the business, and the business is the owner. Since you and the business are one and the same, the business ends when you quit operating as an owner-operator. Because of this, income taxes are fairly simple. The income and expenses from the business are included on your personal tax return. This means any business losses you suffer may offset the income you have earned from other sources. Disadvantages: This form of business does not protect you personally from legal liability. However, carrying the proper insurance should protect you from significant losses in the event of accident liability. It’s important to note that debt incurred by the business is considered debt of the owner. Sole proprietors also need to calculate how much self-employment tax they owe. They pay both employee and employer portions of employment taxes on your self-employed income, which can add up to a large amount depending on your net profit. In addition to paying annual self-employment taxes, you must make estimated tax payments if you expect to owe at least $1,000 in federal taxes for the year after deducting your withholding and credits. Partnership A partnership is similar to a sole proprietorship, but more than one person owns it. The individuals forming the partnership are taxed separately, as they would be if they were sole proprietors. A partnership is easily formed, but a written operating agreement or partnership is strongly recommended to clearly outline the role of each partner and the distribution of profits and losses. It should also formally spell out how you and your partner/ partners will resolve conflict. Advantages: Having access to extra start-up capital, gaining assistance or expertise in some aspect of your business, or having a co-driver who can help increase the miles driven. Disadvantages: Like a sole proprietorship, the partners are not personally protected from legal liability. In addition, it’s important to remember that each partner is held personally liable for the actions of the others in the partnership. Corporation The corporate structure is more complex and expensive to set up than most other business structures. A corporation is an independent legal entity, separate from its owners, and requires complying with more regulations and tax requirements. The biggest benefit for a business owner who decides to incorporate is the liability protection he or she receives. A corporation's debt is not considered that of its owners, so if you organize your business as a corporation, you are not putting your personal assets at risk. A corporation also can retain some of its profits without the owner paying taxes on them. In a corporation, there are initial formation fees, filing fees, annual state fees (like filing annual reports and paying unemployment insurance), additional costs for filing a corporate tax return along with your personal tax return, and monthly fees for payroll and filing payroll taxes. There are two main ways a corporation can be taxed at the federal level: C Corporations and S Corporations. C Corporation C Corporations are not recommended for owner-operator truck drivers due to the double tax on the business's earnings. Not only are C Corporations subject to corporate income tax, but any earnings distributed to shareholders in the form of dividends are taxed at individual tax rates on their personal income tax returns. S Corporation An S Corporation is created through a federal election using Form 2553. In short, an LLC or C Corporation would first be created and the Form 2553, currently filed with the IRS, would allow your business to be federally taxed as an S Corporation. With an S Corporation, the driver is an employee and receives a salary from the corporation. The difference from a C Corporation is that the profits of the business are not subject to tax at the corporate level. Instead, all corporate profits and losses flow directly to the shareholders of the S Corporation and are included on the shareholder’s personal income tax return. Your corporate profits are taxed at the personal level. The result of all this is that you can distribute the profits of the S Corporation to yourself without having to pay taxes on them again, so there’s no double taxation. Advantages: S Corporations give you the liability protection of a corporation without double taxation of a C Corporation. You will save money on taxes by not paying self-employment taxes (15.3%) on the net income of the S Corporation. However, you must make sure your net income is high enough to cover the extra costs and fees. Disadvantages: There’s a lot of talk at the truck stop and on the radio about setting up a corporation, but it’s not as easy as it sounds. If you don’t strictly adhere to managing the corporation “by the rules” then a legal concept called “Piercing The Corporate Veil” can occur and you become personally liable for all activities of the business. This includes all debts, lawsuits, taxes, and penalties. “The Rules” include things like paying yourself payroll (including paying all State and Federal payroll taxes) on a regular and normal basis, maintaining a separate checking account for the business, electing officials, holding regular meetings, etc. Following all the rules of being incorporated is extremely difficult and cumbersome. For most owner-operators, incorporating is not a good choice because the costs of incorporating are greater than the benefits of incorporating. Limited Liability Company (LLC) A limited liability company may offer benefits similar to a corporation. An LLC may offer the limited liability advantages of a corporation but has the tax benefits of a sole proprietor. Taxes for the LLC are prepared using a Schedule C on your personal tax return. This means there is no double taxation. An LLC is simpler and more flexible than a corporation. Formal meetings, records, and many of the forms needed to create a corporation may not be required when setting up and operating an LLC. Advantages: Taxes for the LLC may be prepared using a Schedule C on the individual’s personal tax return. This means double taxation is avoided. An LLC may also elect to be taxed as an S Corporation and receive tax benefits. The shareholders will report net income/losses using a Schedule E. However, an LLC generally does not have the same ongoing meeting requirements as corporations. Disadvantages: Every state treats LLCs differently, which means that an LLC set up in one state may not provide liability protection in another. What should you choose? For the vast majority of owner-operators, it makes the most sense to be a sole proprietor. However, if you have a lot of personal assets that you feel you need to protect, the LLC is probably the next best choice. Once an owner-operator starts making a net profit of around $85,000/year or more, it makes sense to form an LLC and elect to be taxed as an S Corporation so that you can save money on self-employment tax. Every case is unique, but at around $85,000 net income, an owner-operator can save around $4,200 in taxes by filing a corporate return. The additional costs for being incorporated are typically around $1,500 - $2,500. To learn more about choosing a business structure for your trucking business, please call 866-920-2827 to speak with an ATBS enrollment specialist today or download our FREE ebook on Owner-Operator Incorporation .

Buying a semi-truck is a big and exciting decision in your trucking career. Before you get started, it's crucial to understand the financial commitment involved in purchasing a semi as well as the specific needs you require from your new truck. With this guide, we will help you map out what to consider in your truck-buying journey. How Much Does it Cost to Buy a Semi-Truck? Purchasing a semi-truck is a significant investment for anyone in the trucking industry. If you're looking to buy new, prices typically range from $175,000 to $250,000. Factors influencing the cost include the truck's make, model, and features. These new trucks come with the advantage of factory warranties and a reduced likelihood of maintenance issues. In contrast, buying a pre-owned semi-truck can be considerably more affordable, with price tags around $50,000 to $75,000. This is a stark difference from the heftier purchase price of a new semi. It's worth noting that used semi-trucks also tend to depreciate less rapidly. When choosing between a new and used truck, keep in mind that newer models may come equipped with the latest technologies, like assisted driving tools, which can enhance safety and efficiency. Furthermore, they offer improved fuel economy, which can offset some of the upfront costs over time. Whether you opt for a new or used semi-truck, it's essential to consider the ongoing operational costs, such as maintenance. Remember to factor in these recurring expenses when determining the total investment for your semi-truck purchase. How to Determine Your Trucking Needs Pinpointing your specific trucking needs is crucial for selecting the right semi-truck. Start by assessing the type of hauling you'll undertake. Will your routes be local, or are you planning long-distance, cross-country hauls? Perhaps you're considering hotshot trucking for urgent deliveries. Next, determine the cabin type fitted for your work. Day cabs suit shorter routes, while trucks with sleepers are necessary for long-haul trips. Transmission type is also key – weigh the pros and cons of manual versus automated manual transmissions based on your comfort and experience. Critical to your decision-making is understanding the Gross Vehicle Weight Rating (GVWR). It's essential to choose a truck that can handle your typical cargo load without exceeding legal weight limits. Matching your truck to the cargo you'll carry ensures you don't overcommit or underutilize the truck's capacity. Here's a quick checklist to sum up: Route Type (Local vs. Long-Distance) Cabin Type (Day Cab vs. Sleeper) Transmission Type (Manual vs. Automatic) Gross Vehicle Weight Rating (GVWR) Cargo Type Compatibility Careful consideration of these factors will guide you toward the perfect truck for your business operations. What Should I Look for When Buying a Semi-Truck? When venturing into buying a semi-truck, begin by establishing a clear budget, factoring in not just the purchase price but also taxes, fees, and the potential ongoing costs like maintenance and fuel efficiency. Seek out a reputable dealer known for dealing in high-quality commercial trucks. Their reputation in the industry can be a testament to the reliability of the vehicles they offer. Here’s a quick checklist to consider: Dealer Reputation: Choose a trusted dealer with positive industry feedback. Budget Consideration: Account for all purchase and operational expenses. Close Inspection: Opt for a truck with an unblemished history report. Ensure that the history report of the semi-truck is transparent, indicating no past accidents or significant damages. It's also wise to review the truck’s maintenance records to understand the frequency and quality of preventative maintenance it has undergone. This documentation will help to paint a picture of any potential maintenance issues and guide future routine maintenance schedules. A sound investment is not just about the upfront cost, but also about minimizing future operating costs through a reliable, well-maintained truck. Choosing the right semi-truck is a significant decision that requires diligence and attention to detail. By addressing these key elements, you will be well on your way to finding the perfect truck to serve your business needs. What Do I Need to Buy a Semi-Truck? When considering the purchase of a semi-truck, whether for expanding a fleet or starting out in the trucking industry, there are several key requirements and considerations to be aware of. To ensure a smooth transaction, here's what you need to buy a semi-truck: Commercial Driver’s License (CDL) - A valid Class A CDL is essential. Reputable dealers will verify that truck drivers have the appropriate licensing before completing a sale. Down Payment - If financing, you'll need a down payment, usually ranging from 1% to 40%. The exact amount can be influenced by your credit score and the financing terms offered. Credit History - Lenders will examine your credit history as part of the financing process. This review helps determine your interest rate and eligibility. Financial Documentation - Be prepared to provide proof of financial capability. This is crucial whether you’re buying the truck outright or financing it. Financing a Semi-Truck: Quick Reference Buying a semi-truck is a major decision that requires careful consideration and preparation. From having the necessary licensing to understanding your financial capabilities, being fully prepared will greatly increase your chances of finding the perfect truck for your business needs. Whether you choose to pay in cash or finance the purchase, remember to thoroughly inspect the truck and ensure it aligns with your specific requirements. By following these guidelines and conducting thorough research, you can make a well-informed decision and set yourself up for success in the world of trucking.

What is IFTA? The International Fuel Tax Agreement (IFTA) is a pact between the lower 48 states and the ten Canadian provinces that requires all interstate motor carriers to report fuel taxes. The agreement doesn’t affect Hawaii, Alaska, or the three northern Canadian territories. IFTA was created to replace the old fuel tax system, in which trucks were required to have a separate decal for every state they operated in. The current IFTA reporting system simplifies the hassle of reporting fuel tax for trucking companies (including owner-operators) who operate across IFTA jurisdictions by reducing paperwork and minimizing the compliance requirements. Keep in mind that IFTA is not an additional tax. IFTA was put into place to redistribute the tax to the states where the fuel is actually being used, not where it is purchased. This means no matter where you buy the fuel, you're paying the fuel tax in whatever states you're driving in. What motor vehicles are required to follow IFTA? IFTA is required for any motor vehicle with the following specifications: Those with two axles and a gross vehicle weight rating or registered gross vehicle weight above 26,000 pounds Those of any weight that has three or more axles Any combination of vehicles with a total gross vehicle weight or weight rating above 26,000 pounds How does IFTA work? Every owner of a qualified motor vehicle must submit an IFTA application, or have their bookkeeper or accountant do so on their behalf. After you submit your application, you will receive an IFTA license as well as an IFTA decal for each qualified vehicle you operate. Whenever fuel is purchased, the amount is logged into the truck owner’s IFTA account. At the end of each quarter, you must submit an IFTA report that lists the miles driven and the gallons purchased. These reports will determine either the amount of tax still owed or the refund you are due. The IFTA office in the trucking company’s home state will issue your refund or debt. Quarterly reports must also be filed as long as the vehicle is operational. This must be done even if the truck isn’t used for commercial purposes for one or more quarters. IFTA decals expire every year on the 31st of December. Carriers have until the end of February of the next year to re-register. What are the IFTA tax rates? The IFTA tax rates vary by the state or province you are purchasing fuel. The IFTA tax rates change each quarter. Click here for the most updated fuel tax rate chart. When must the IFTA reporting be filed? For January through March, the due date is April 30th For April through June, the due date is July 31st For July through September, the due date is October 31st For October through December, the due date is January 31st How do I file an IFTA report? Electronically: Your return is considered received on the date it is submitted. By Mail: Your return is considered received by the postmark date on the envelope. Walk-in: Your return is considered received on the date it is delivered to the office. What happens if I fail to file or pay a quarterly return? Failing to file a quarterly return within 30 days of the due date will result in your license being suspended and a Jeopardy assessment being applied. An IRS Jeopardy assessment is a significant escalation of a tax problem that is made when the IRS believes it’s at risk of losing money. If you file a quarterly return but fail to make a payment on the return - including late fees, interest, and penalties - within 90 days of the due date, your license will be repealed and you will be given a Jeopardy assessment. Your license won't be valid until you have paid all taxes, penalties, and interest. Once a Jeopardy has been assessed, you will have 60 days to file and pay the late return. After 60 days you will be responsible for paying the full amount of the Jeopardy. Once your account has been brought current, you will need to apply to have your license reinstated. How does understanding IFTA help you save on fuel? When you're trying to decide between buying fuel in one state compared to another state, you need to subtract the state fuel tax, from the retail price you pay for the fuel, in order to get the net price. This is because, with the IFTA policy that is currently in place, you are being taxed on which state the fuel is being used in, not where it's purchased. Because of this, fuel taxes are out of the equation, because they are being paid anyway. This means you might as well pay for fuel in the state where the net price is going to be the lowest, not the retail price. Looking at the net price of fuel will give you an accurate comparison between each state. This means that even if a state has a cheaper retail price of fuel, it may be more expensive to buy fuel there in the long run if the net price is higher. As a simple example, at the border of Colorado and Nebraska, you may see the retail fuel cost in Colorado at $3.00 and the retail cost of fuel in Nebraska at $3.02. Judging by the retail cost, you would fuel up in Colorado. However, when you look at the net price of fuel before fuel tax it would actually be Colorado $2.79 ($.205 fuel tax) and Nebraska $2.74 ($.277 fuel tax). Considering that you will be paying the Nebraska fuel tax anyway when you drive across Nebraska, it would be cheaper to fuel up in Nebraska. When thinking about this, the most important thing to keep in mind is, that no matter what, you are paying the fuel taxes in the state you're driving in. This will hopefully help simplify this concept. If you have any questions, please give us a call at 888-640-4829.

The Heavy Highway Vehicle Use Tax has several names including Federal Highway Use Tax, FHUT, 2290, or even “Road Taxes”. ATBS receives calls year-round from owner-operators asking about this tax, often stressed or concerned about the conflicting messages they receive. It’s an important tax for owner-operators to be aware of and to be prepared to address every year. What you need to know about "Road Taxes" - the Heavy Highway Vehicle Use Tax (FHUT) Background The Heavy Highway Vehicle Use Tax is a tax imposed yearly by the IRS on anyone who owns and operates a heavy highway vehicle (Class 6, 7, and 8 trucks are included) with a taxable gross weight of 55,000 lbs. or more on public roads. Taxable gross weight is a combination of the following: The actual unloaded weight of your truck fully equipped. The actual unloaded weight of any trailer or semitrailer fully equipped. The weight of the maximum load typically carried on your truck and trailer(s). These taxes currently have a maximum of $550 per year (taxes increase as the taxable gross weight of the vehicle increases), and they are used for highway construction and maintenance. When you file a Form 2290, you must provide an Employer Identification Number (EIN) as opposed to your Social Security Number. This is true even if you have not established a business entity and are a sole proprietor and conduct business through your Social Security Number. If you don’t already have an EIN, you can apply online for free through the EIN section of the IRS website, or contact us for assistance. Deadline to File The FHUT tax season runs from July 1st until June 30th of each year, and is reported using the IRS Form 2290. The form must be filed on the first month that the vehicle is used on public highways, not when the vehicle is registered. The way that works is if you use your truck in July, then you must file your Form 2290 between July 1st and August 31st. However, if you are using your vehicle after July 31st, then you must file your form by the last day of the month following the month of the vehicle’s first use; your taxes will be prorated for the year. If you stop using, get rid of, or sell your vehicle halfway through the season, you can get a refund for part of the calendar year. Using IRS Form 8849 and a Schedule 6 will let you do that. If you have questions about the deadline to file the FHUT tax, please give us a call at 866-920-2827. Lease Purchase Program Often ATBS is asked, “What if I am not the registered owner of the truck, but am leasing the truck through a lease purchase program, another lease program through my carrier, or a 3rd party leasing company?” In this situation, if the lease agreement you signed states that you are liable for all taxes involving the vehicle then you are liable for this tax. Generally speaking, most carriers with a lease purchase program, and some 3rd party truck leasing companies, will file the 2290 on the vehicle. Since they are the registered owner during the term of the lease agreement they are ultimately liable. But often they will deduct from the contractor a fee to cover the tax. In some cases, you may still have to obtain an EIN, file, and pay the 2290 tax if the lease terms dictate that you do so. The best practice is to clarify this with your carrier or leasing company prior to lease signing. If you are being asked by your carrier, or possible other agencies, for proof of payment of the 2290, you will need to produce Schedule 1 of the Form 2290 that is stamped “paid” by the IRS. Make sure you obtain and keep a copy of this in your permit book. Penalties for Not Filing and Paying As with most taxes, if the Heavy Vehicle Use Tax is not filed on time and appropriately paid there will be penalties and interest imposed by the IRS. Interest accrues monthly, and as a result, what started out as a flat $550 tax can increase by hundreds of dollars very quickly. Operationally, even though your truck may not be impounded, you may be put out of service if you cannot provide proof of payment (stamped Schedule 1) of the 2290 to your carrier or governmental agencies. The ramifications of skipping this tax are obviously not worthwhile since they can result in lost revenue of thousands of dollars. Partial Payment The IRS requires a full payment of the Heavy Vehicle Use Tax. Partial payments will not be accepted and may result in penalties and interest being imposed. If you are having trouble filing your 2290, visit our friends over at ExpressTruckTax, the leading 2290 e-filing solution in the trucking industry! Over 150,000 owner-operators have made the choice to hire ATBS over the past 25 years. We offer a variety of services including accounting, bookkeeping, and tax preparation. We also offer unlimited business consulting for our RumbleStrip Professional clients. A dedicated business consultant will help you keep your business “between the lines,” just like rumblestrips on the highway. If you’d like to learn more about ATBS services or want to get started today, give us a call at 866-920-2827.

In the summer, we’re bombarded with articles, ads, news stories, and social media posts encouraging us to wear sunscreen whenever we’re outdoors. But what you may not realize is that sunscreen should not only be worn when you’re out of the house but also when you plan to be in your truck or car for a long period of time. Most vehicles typically include laminated windshields that filter out UV rays. But rear and side windows are made of non-laminated glass that only filter UVB rays and not the harmful skin-penetrating UVA rays. Aside from the infamous ‘Trucker’s Tan’, driving without sunscreen can also lead to premature aging and even skin cancer. Ultra-Violet Radiation UV radiation is part of the light spectrum that reaches the Earth from the sun. Its wavelengths are invisible to the naked eye. These wavelengths are classified as UVA, UVB, or UVC. UVA and UVB rays reach Earth, while most UVC rays are absorbed by the ozone layer. Both UVA and UVB play an important role in causing premature skin aging, eye damage (including cataracts), and skin cancers. They also suppress the immune system, reducing your ability to fight off disease. UVB Rays UVB rays are the main cause of skin reddening and sunburn and tend to damage the skin's outer layers. The most significant amount of UVB hits the U.S. between 10 a.m. and 4 p.m. from April to October. However, UVB rays do not significantly penetrate glass, so these aren’t the ones you really need to worry about when inside your truck. UVA Rays Throughout our lives, we are exposed to large amounts of UVA light. They are less intense than UVB rays, but up to 50 times more prevalent. They are also present during all daylight hours, throughout the entire year, and can pass through clouds and glass. UVA rays penetrate skin more deeply than UVB rays and play a major part in skin aging and wrinkling. UVA also damages skin cells in the basal layer of the epidermis where most skin cancers occur. How This Affects Truckers A recent study published in The Journal of the American Academy of Dermatology found that people who had spent the most time driving each week were more likely to develop skin cancers on the left sides of their bodies and faces, the side exposed to more sun while driving. In patients with malignant melanoma, the deadliest form of skin cancer, 74 percent of the tumors were found on the left side, compared with only 26 percent on the right. To protect yourself, apply sunscreen to any exposed areas (like your hands, forearms, and face) every time you get into your truck for a long ride, regardless of the season. Make sure to use a broad spectrum sunscreen that blocks both UVA and UVB rays with an SPF rating of 50 or higher. You may also want to purchase a sun shirt, which will block most UV rays better than a plain t-shirt. Following these steps will help you and your skin stay healthy for the long haul.

If you’re a small business owner, it’s easy to see why you sometimes feel a bit overwhelmed. You’re responsible for multiple functions on any given day. It’s no wonder that keeping things straight can be challenging. So how can you increase your productivity and make your life a little easier? Here are eight tried and true time management and productivity tips for small business owners: Don’t multitask Yes, you wear tons of hats but don’t try to wear them all at the same time. If you’re on task, stay on that task until it’s complete and finished. The quality of your work suffers when you don’t devote your full attention to the task at hand. Don’t procrastinate It’s a simple win to check off all the easy tasks on your daily to-do list but don’t put off those difficult or daunting tasks because they’re unpleasant. Tackle them head-on and complete it. It will make you feel good, accomplished, and relieved to get it off your list and get it done! Plan your work; work your plan Create a list of tasks you need to accomplish each morning. Make the list realistic. Prioritize those tasks and then start with number one and work through your list. Sounds simple enough, but all too often distractions get in the way and before you know it you’re multitasking (see point one). Check email only after completing a task It’s very easy to get distracted if you check your email after every email notification alert. While it may be hard to do at first, try ignoring those alerts until you’ve finished the task at hand, and only then review your inbox. Use a calendar Google and Outlook both have integrated calendar features that allow you to plan your schedule. Put placeholders in for the tasks you need to accomplish. These calendars have mobile apps as well, allowing you to access your calendar on the go. Plan for contingencies You need to build time into your schedule for the unexpected. Being late is not a healthy habit. Plus, getting to your meeting a little early allows you to take a deep breath and focus on the meeting outcome. That extra little bit of prep time can be valuable. Unless it's business-related, social media fun comes after work It’s easy to get distracted on social media today, with Twitter and Facebook streams sharing all that much-needed information (insert sarcasm). Sure it’s good to catch up on family and friend happenings, but doing it after work will keep you focused on more important matters. Take a lunch and breaks When you’re on a roll, it’s easy to simply work through lunch or eat at your desk. Unless you’re on a deadline, don’t do it. Get up and get out of the office for lunch. Take a walk or short drive to clear your head. While this may seem counterintuitive, these breaks will help you refocus and increase your energy levels. As a small business owner, your productivity and time management are paramount. We hope these eight tips help you stay focused and manage your all-important workday. You might also find these other recent posts helpful in your role as well, so be sure to check them out. Image 1 source: https://www.flickr.com/photos/michaelloudon/ Image 2 source: https://www.flickr.com/photos/klash/

Oftentimes, when there is a boom in freight rates, we see a counter-intuitive pattern develop among the Owner Operator population. Generally speaking, Independent Contractors tend to run fewer miles, while rates are high. Below are a few of the trends and uncertainties we see going on today that make the duration of this high freight rate season specifically hard to forecast. This year’s unpredictability is why, as a business owner, you should consider running hard now while freight rates are high to position yourself successfully & give you more financial flexibility in case freight rates change suddenly. To the outside eye, that may seem puzzling “Why not run harder when rates are high?” However, to many drivers, this is an opportunity to take advantage of extra time off by running fewer miles and making the same or better income than during average or down rate periods. After all, this is a demanding job, both physically and mentally. Taking advantage of the high rates by taking time off while making a similar income can be the reset many drivers need to keep going. However, this current high freight rate period feels different. There is so much that is unprecedented & unpredictable happening within the nation & global economy, which makes this high freight rate season tough to predict. How much longer will it last? How far will rates drop once this surge is over? No one can confidently say… Below are a few of the trends and uncertainties we see going on today that make the duration of this high freight rate season specifically hard to forecast. This year’s unpredictability is why, as a business owner, you should consider running hard now while freight rates are high to position yourself successfully & give you more financial flexibility in case freight rates change suddenly. Pandemic & Political Policies: Regardless of your political preferences, Joe Biden has reportedly won the election to become the 46th President of the United States of America. As such, he brings with him a new plan for handling the pandemic and the possibility of another nationwide shutdown. This quote, taken directly from Joe Biden’s campaign website, helps to illustrate his strategies for tackling the pandemic & the possibility of another shutdown: Social distancing is not a lightswitch. It is a dial. Joe Biden will direct the CDC to provide specific evidence-based guidelines for how to turn the dial-up or down relative to the level of risk and degree of viral spread in a community, including when to open or close certain businesses, bars, restaurants, and other spaces; when to open or close schools, and what steps they need to take to make classrooms and facilities safe; appropriate restrictions on size of gatherings; when to issue stay-at-home restrictions. Many drivers during this year’s shutdown were severely impacted financially. You may recall that many manufacturers were delivering products at a slower rate or shut down entirely. With less freight available to ship and thus more drivers available to haul, the spot market rates were critically low during the early shutdown months (weeks 12-27 of this year, according to TruckStop.com Spot Market Insights). It’s possible this could occur again if the coronavirus infection rates continue to climb throughout the nation. There is also the possibility of a more long term recession if the virus continues to spread. For months, we have heard that a vaccine is coming, but the reality is no one can confidently say when the FDA will approve a vaccine or how fast manufacturers can produce the vaccine to immunize the entire country & globe. The coronavirus’s impact on employment and consumer spending cannot go without concern. In March, the U.S. government passed the CARES Act, which adopted policies like the PPP loans and extra unemployment benefits to stave off the first wave’s recession. However, we do not yet know if the policies will be enacted again or be as successful if the virus’s second wave continues to ramp up. Nor do we know for sure what the impact of these policies will be long term on the US economy. Below is an excerpt from a simulation analysis done by the Penn Wharton Budget Model regarding the short term and long term effects of the first wave’s CARES Act: The deficit-financed CARES Act provides a short-term boost to GDP as well as relief to families, workers, business owners, health care institutions, and governments affected by the pandemic. Moreover, the relief can be especially valuable to people who have lost their jobs and businesses that are no longer able to produce goods and services in this environment. Nonetheless, without fiscal policy to reduce the debt in future years, the CARES Act will result in a small but long-term decline in GDP as the additional debt crowds out private capital and lowers wages. The Holiday (Spending) Season: The next problematic factor to consider is the typical spending & time off around the holiday season. It’s a cliché at this point that every year people spend much more than they budgeted for on holiday gifts, travel, and treats. This extra spending is generally true for everyone during the holiday season, and speaking in generalities, our clients are no different. There is nothing inherently wrong with taking time off and treating your friends and family or yourself during this time of the year, but you must plan for it. With the typical slow freight season coming directly after the holiday season and the possibility of another shutdown, you must be prepared financially for the possibility of much lower rates on the horizon, especially when you factor in time off. Time off & extra spending means less revenue, continued payments on fixed costs, and a much tighter personal & business budget following the holidays. So what does this all mean? All of these unprecedented and unpredictable factors combined with yearly trends are why this year’s inflated freight rates must be taken advantage of while you can. The old saying “Make hay while the sun shines” rings more accurately than ever. Run hard now, while freight rates are high and freight is abundant, so you can set your business up to have enough cash flow to survive a freight recession if/when freight rates come back to earth.