Should You Stay With A W2 Or 1099 ?

I’m looking for everyone’s input on either staying a company driver and getting w2 for taxes or working for an independent company and making more money per mile but you would have to do 1099 at the end of the year .

Stay w2!!!! seriously

Search here for "1099". It's a financial headache & trap for the driver.

Paying an employee under "independent contractor" is a money saving scam for your boss, and it's illegal.

I didn’t know that it was illegal. I was trying to figure out for myself it was just really with the headache or not . My last career , a barber, was all 1099 and I do understand the headache of balancing your books and keep all receipts I just know that trucking and barbering are totally different. I’m gonna look into the illegal part if that’s the case then screw that I’ll stay where I’m at.

If you previously worked as an independent contractor then you likely know most or all of the issues so I will not rehash that unless you have any specific questions. I know everything, or at least almost everything, that can reasonably be known about this subject....I studied the matter intensively for 15+ years.

The legality area Errol refers to is signficant.

First, know that if you make the choice to take the 1099, YOU are not doing anything illegal, so long as you report and pay self-employment tax. If anyone is doing anything illegal, it is the company.

It comes down to whether you are working as an independent contractor or not. That status is defined partially by the IRS, partially by statutes and regulations of the state you are considered to be employed in, and partially by case law (court decisions). The status can in some cases differ depending upon whether tax law is considered, or labor law for purposes of workers' compensation laws, etc.

Here are some of the factors, colored to reflect the trucking business:

Who owns the truck? If the company, you are probably an employee. If you, maybe you are an IC.

Who controls dispatch? Who chooses the loads? Who determines when/whether you work? If it is you, then you may be an IC. If the company, you may be an employee?

Can you have employees, and can they operate your equipment? If yes, maybe you are in IC. If no, maybe you are an employee.

Who chooses your routes? Who chooses your fuel stops? If you, maybe you are an IC. If the company, maybe you are an employee.

Can you accept freight from other sources? Deal with whatever brokers/customers you choose to? Can you find your own customers? If yes, maybe you are an IC. If not, maybe you are an employee.

Who furnishes the various tools of your trade? If you, maybe you are an IC. If the company, maybe you are an employee. (This one is not a huge factor....but if the company furnishes the tools of the trade, that will surely tilt things toward the employee status)

Do you stand a chance of making a profit or loss? If so, maybe you are an IC. If not, maybe you are an employee.

I could go on, but I am sure you get the gist. No one factor necessarily determines all, but multiple factors leaning one way or the other might carry the day.

Disclaimer: I am not a lawyer or a CPA . However, I did operate a business for many years that had a workforce consisting of a combination of about 70 employees and about 150 ICs. The management team worked very hard to make sure that the ICs remained ICs. I had numerous relevant agreements reviewed by competent labor law attorneys, and we attended numerous training workshops conducted by prominent labor law attorneys, so I know about this stuff.

I didn’t know that it was illegal. I was trying to figure out for myself it was just really with the headache or not . My last career , a barber, was all 1099 and I do understand the headache of balancing your books and keep all receipts I just know that trucking and barbering are totally different. I’m gonna look into the illegal part if that’s the case then screw that I’ll stay where I’m at.

Hey Dave thank for that information. You must definitely brought up a quite a few things that I did not take into consideration and it’s much appreciated. Thank you.

Excellent points Dave! That was well laid out and clearly stated. Thanks!

Folks, most of the time in the trucking business, if you are offered a 1099 job, the company is doing something shady/illegal. It is very common though.

It is more than just trucking. I was a barber as well. There IS a lot of shady employment practices in barbering. Pretty much all barbers are given 1099s. Many though should be given W-2's. I am sure you are aware that an 'employer' paying you as a 1099 is just to avoid taxes and certain responsibilities such as workers compensation.

In barbering the biggest single thing I can point to is if you booth rent, than you are an IC. If you earn a commission than you are an employee. However many barbers are illegally classified as 1099 even though they are paid commission and have their hours set by the employer. Than again just trying to get that 1099 at the end of the year is an utter headache.

In trucking I would say unless you own your truck, pick your loads, and/or are free to obtain loads from other brokers, don't do a 1099. Just my opinion, mind you.

Drive Safe and God Speed