Tax laws for Truck Drivers - how to claim income with a 1099?

Question

Okay, this might be a little confusing.

My husband is a Truck Driver (Owner-Operator). He has been told that since he gets 1099-misc forms for taxes at the end of the year that he doesn't have to pay taxes on the full amount of his income - only on the part left over each month after household (rent, utilities, etc...) are paid.

Is this true? We live in the state of VA. If this is true, how do I claim this on our federal/state taxes... what forms do I use?

Answer 1

No. Household expenses are NOT deductible. However a LOT of his expenses are, such as:

1. Fuel for the rig
2. Interest on the loan for the rig.
3. Maintenance & repairs.
4. Tolls
5. Taxes and permits
6. Lumper's fees for loading and unloading.
7. Hotels & meals
8. Depreciation on the rig.

File Schedule C to accont for the income and business expenses. File Schedule SE to calculate the Self Employment tax. State rules follow Federal on business income. Get the forms from the VA DOR website.

If he's not making quarterly estimated tax payments on Form 1040ES, there will be penalties and interest for underpayment of taxes. VA requires estimated payments as well.

It may be worth engaging a CPA to get the ball rolling on the first year and setting up a bookkeeping system. One you're rolling (no pun intended) you can probalby handle it yourself.

Answer 2

by regulation, organizations are required to submit 1099 suggestion to the IRS. If a employer does no longer, then they're very stupid, because the 1099 recipient can deliver a replica to the IRS, ensuing in an audit and fines on the employer. If the employer would not grant you with a 1099, and would not report some thing, then you're in that gray section the position in effortless words an IRS audit can seize you. notwithstanding, maximum those who get a 1099 will assume that it really is been despatched to the IRS (it really is the regulation), and could record that earnings. it really is a wide pink flag for the IRS to study out the employer in touch. in case you received a 1099, and record it, then you have not any more suitable tax criminal duty. finally, you and the employer are the most important aspects in touch. If one among you would not record some thing, it really is the pink flag. If both do, or both do no longer, then the IRS would not comprehend any extra appropriate. yet when both are unlikely to record, then the varieties ought to not at all were executed.

Answer 3

Seek A Professional Tax Person immediately. I don't know where he got his advice from, but it is erroneous. Not only are taxes to be paid, but 100% of Social Security taxes and Medicare are your responsibility.

good luck & blessing

Answer 4

YOU CAN USE ALL THE THINGS THAT IS BOUGHT FOR THE TRUCK AS A DEDUCTION. PAPER TOW ELLS WINDEX LOG BOOKS ETC