Tax Preparer for Truckers: What Should You Look For?
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If you own a trucking company, or are an independent trucker, you have undoubtedly noticed that truckers have to pay quite a few different taxes, and the way you must go about paying those taxes is complex.
Unless your trucking company has a large accounting department, it is a good idea to hire a professional tax preparer to handle everything for you. According to the website simplexgroup.net/tax-preparation-filing, there are a few things you should look for when you are hiring a tax preparer for trucks.
How long have they been in business?
Make sure that the company you hire has been in business for at least a few years and that they have handled accounts like yours before. They should have references and good reviews.
Check credentials too. The IRS says anyone paid to prepare returns must have a Preparer Tax Identification Number (PTIN), but credentials vary. CPAs, enrolled agents and attorneys are credentialed, and you can look preparers up in the IRS Directory of Federal Tax Return Preparers.
Do they have time to handle your account?
If you hire a small company to handle your account, you should make sure that they have enough time to take care of all of your needs. Ideally, one accountant should be assigned to your account and be reachable when you have questions, especially around quarterly deadlines.
Do they know the industry?
You may already know a great CPA, and they might be honest, accurate, and diligent in their work. They might also know absolutely nothing about the trucking industry. Trucking businesses face taxes and filings that most other businesses don't, such as fuel tax reporting and heavy vehicle use tax. Your tax preparer must be familiar with these taxes and the rules behind them.
What are some of the taxes that truck drivers pay?
Truck drivers pay taxes on the fuel that they use, and these taxes help pay for the roads they drive on. Before fuel tax agreements, a carrier could need separate fuel permits for each state it drove in, which was time-consuming for drivers and states alike. It also meant a state could miss out on tax when a truck drove through without buying fuel there.
The International Fuel Tax Agreement simplified the process. Instead of registering with each state, a carrier gets one IFTA license from its base jurisdiction (home state or province). It files one consolidated quarterly return there, and that jurisdiction distributes the tax among the states and provinces where the miles were driven.
To file, interstate carriers must keep records of fuel purchases and the miles driven in each jurisdiction. In Texas, for example, returns are due on the last day of the month after each calendar quarter. Late filing brings penalties and interest.
Weight Distance Taxes (KY, NY, NM & OR)
A few states, including Kentucky, New Mexico, New York and Oregon, charge an extra tax based on a truck's weight and the miles it travels in the state. An accountant who understands trucking can make sure you file these correctly and claim every deduction you're entitled to.
2290 Road Taxes
IR Form 2290, the Heavy Highway Vehicle Use Tax Return, covers highway vehicles with a taxable gross weight of 55,000 pounds or more. According to the IRS, vehicles expected to travel 5,000 miles or less in the period (7,500 for agricultural vehicles) can claim a suspension from the tax, but still must be reported on the form.
If you know a bit about taxes and you ask the right questions, you can find the perfect tax preparer to help your company succeed.
Sources
- Choosing a tax professional, Internal Revenue Service
- About Form 2290, Heavy Highway Vehicle Use Tax Return, Internal Revenue Service
- International Fuel Tax Agreement (IFTA), Texas Comptroller of Public Accounts
