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Tax Tips
Paying state business taxes and more trucker tax FAQs

By Howard Abrams
PBS Tax & Bookkeeping

 

We are receiving frequent calls from truckers who have heard from various states that they need to pay taxes such as income or personal property taxes. Some of the states are New Jersey, Iowa, Oklahoma and Michigan. 

We received a call from a client who lives and conducts his business in Tennessee. He has a driver who lives in Michigan. He received a notice from Michigan that he is liable to pay a Michigan business tax. It turns out that if your driver picks up a load in Michigan or just drives through the state, you could be liable for the tax.

The state found out about our client because he issued a 1099 to the driver. What we discovered in our research was that our client was exempt because his mileage and his revenue attributed to the state compared to his total mileage and revenue was not high enough to be liable for any Michigan tax.

There are truckers out there who would have paid the tax. If you ever receive any new type of tax to file, do your research. Don’t pay anything until you’re sure you’re liable.

More frequently asked questions

Q: I turned 65 last year, and I still work. Someone told me that I don’t have to file income tax returns any longer. Is that true?

A: No. No matter what your age, if you have income, you are liable to file for and pay income taxes.

Q: I have reached full retirement age and collect Social Security although I still work. Do I still have to pay self-employment tax?

A: As long as you have earned income, you still have to pay into Social Security. It does not matter what your age is or if you are an employee or owner-operator. LL


Everyone’s financial situation is different.

This article does not give and is not intended to give specific accounting and/or tax advice. Please consult with your own tax professional.

This article is written by PBS Tax & Bookkeeping Service, a company that has been providing income tax and bookkeeping services to the trucking industry for more than a quarter-century.

If you would like further information, please contact PBS at 800-697-5153 or visit their Web site at www.pbstax.com.

March/April
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