Truck drivers are a commonly misunderstood type of independent contractor. Truck drivers are among the largest group of contractors to have the IRS file a substitute for return (SFR). When the IRS files an SFR on your behalf, the IRS will file the return without deductions for your expenses. The IRS bases its calculations exclusively on the income reported on any 1099 you received as a truck driver. The resulting tax due is generally an excessive amount.
Your trucking expenses are a substantial part of operating your business. They include insurance, registration fees, gas, miles, parts, maintenance, repairs, tires, tolls, parking fees, and so much more. To be an accurate representation of the true amount you bring home at the end of each year, the amount reported on your 1099 must take into account your expenses.
If you are a truck driver who has not filed a return in many years and wants to avoid the IRS filing an SFR or you have had an SFR(s) filed on your behalf, our tax lawyers in Orlando, FL are experienced at handling your situation. We can evaluate your situation and develop a strategy to represent you against State and Federal tax agencies.
We Help Truck Drivers Get Tax Debt Relief
Truck Driver Case Study #1 – Mr. J
Mr. J hired J. David Tax Law to help resolve several tax issues, including $180,000 in tax debt for the last 2 years. At the time Mr. J contacted J David Tax Law, the IRS was sending notices regarding imminent bank levies for the older balances and tax liens had been filed for the two years with balances. Mr. J also feared there would be more SFRs prepared for the last three years of unfiled tax returns. While the IRS allows for original returns over SFRs they have prepared on your behalf, the IRS has a statute of limitations on how far back a tax preparer can use an original to replace an SFR.
Mr. J’s Tax Debt Relief Solution
Within just a few hours of speaking with our tax experts, we were able to get a collections hold placed on Mr. J’s IRS account. While we worked on his debt, we wanted to ensure no levies could be placed on his account. After reviewing his trucking expenses with our tax experts, Mr. J provided his profit and loss statements for the two years that the IRS filed SFRs and for the three years without returns. With this information, we were able to expedite the preparation of his unfiled tax returns for all five years. The tax returns we prepared correctly showed Mr. J’s true tax liability for all five years was $15,000 compared to $180,000. After the returns were submitted and processed, we secured a small payment arrangement for Mr. J that was less than $200 a month for his remaining balance. Now, Mr. J has peace of mind knowing the IRS cannot try to levy his bank accounts. This made Mr. J very appreciative of our help as a levy would make it impossible for him to keep working as a truck driver.
Client Case Study #2 – Ms. V
To resolve her debt of $275,000 for the previous 5 years, due to SFR’s, Ms. V reached out to J David Tax Law for help. Her health had deteriorated leaving her unable to drive the long routes that she once drove. This cut her income by more than half and caused her to fall on hard times. The collection actions by the IRS had begun and on more than one occasion, they levied her bank account. Fearing she would not be able to survive on what the IRS would leave her, she hired J David Tax Law to get help with her returns and the levies. There were two issues Ms. V faced: her balances were not assessed correctly, and her health left her in a position where her expenses exceeded her income and she could not afford to make payments.
Our Customized Solution for Ms. V:
Within just a few hours of speaking to the tax experts at J David Tax Law, we got a collections hold placed on Ms. V’s IRS account, stopping any additional levies. She had a lot of receipts and had trouble understanding what expenses she was able to deduct when she filed her returns. Our tax experts are patient and they took the time Ms. V needed to understand what expenses were allowed and how to prepare a profit and loss statement. After our advice, Ms. V was able to pull together the documents we needed, and she created the profit and losses for the missing years. With the profit and losses for all five years, we were able to prepare the original returns. The true liability for all five years was $22,000 compared to $275,000. This was reflected in our firm’s accurately prepared returns. Once the returns were submitted and her balance owed corrected, our tax experts moved on to her current situation. To show that Ms. V was in a hardship, we performed a complete financial analysis and submitted to the IRS the proper documentation. With the prior returns correctly filed and a hardship established for the debt, Ms. V did not have to make payments. Ms. V had the peace she needed to sleep at night knowing she did not have to worry about the IRS and their aggressive collection attempts.
We Offer Customized Tax Debt Relief Solutions for Truck Drivers
As a truck driver receiving 1099 income, taxing agencies are likely to file a substitute return that exceeds the tax debt amount you owe. When you go a long time without filing your tax returns, you increase the likelihood that SFRs will be prepared and the IRS will begin collection attempts. Their collection attempts can be aggressive, and they include levies or garnishments of your bank accounts, wages, social security, and other methods. They will also assess penalties and interest, which increases the amount you owe further. If you are a trucker driver needing assistance with Federal or any State liabilities, or unfiled tax returns, our tax lawyers in Orlando, FL can help.
He is the founder and Managing Partner of J. David Tax LawSM. He is the winner of the 2019 Ultimate Tax Attorney awarded by the Jacksonville Business Journal. This award recognizes law firms and attorneys who show exemplary professional talent and skill while demonstrating superior client care, leadership, charitable concern, and civic engagement. Jonathan graduated from Chapman University School of Law. He has practiced law since 2011.
We provide tax solutions for our clients who have IRS and state tax debts, unfiled returns, audits, etc. We advise you on future compliance that enables your individual or business tax problems to be behind you for good.