How to Start a Trucking Company (1) – Picking Your Corporate Name
- October 28, 2016
- Posted by: admin
- Category: CDL General Information,
By now you’ve decided to start your own trucking business and really make those big bucks. Hopefully before you made this decision you had some time to think about what your trying to accomplish. It’s also very important to have experience in the industry either working with a trucking company doing administrative work or as a trucker on the roads. It’s important to note; starting your own trucking company is difficult as with any business however if your split up the process than you’ll be able to take some of the stress out of the entire process. Next,
It’s important to be clear about your vision and keep pushing forward. Hopefully we can provide you with the information you need on how to start a trucking company. Let’s get started with choosing a corporate name and some of the factors you need to be careful about.
1.0 – Corporation Name
When choosing your corporation name there are a few things you need to be careful about that will protect you in the long-run and save you a lot of money.
First, it’s important to pick a name other than your personal name because going forward you’ll be able to avoid any confusion when filing taxes, etc. Next, before you start filling out any other paperwork for your business it’s important you register your corporation so everything can be under that name going forward. It’s a great way to organize tax filings, receipts and other documentations. Some people start looking into obtaining a business account and/or equipment without having a registered business name. Shifting things over at a later date can be a huge headache and cost you enormous money due to accountant fees. Next,
Filing for an EIN number (employer identification number) before having a corporation registered will give you two numbers to manage instead of simply one. By filing for a corporation first you’ll be able to indicate this number on your EIN form and the IRS will use the corporation number as your EIN number. This keeps things under one number and won’t mix things up at a later time.
Having the same EIN and corporation number will allow you to file for permits under “1” name.
Many people make the mistake of registering their trucking company as a “sole proprietorship” and don’t realize having this type of business will put everything under your personal name. We recommend paying the extra corporation fee so your clear of any liabilities. Starting a trucking company is very costly because of the equipment required and if unfortunately things don’t work out, you DON’T want to be liable for the debt. It’s important to keep your personal and business assets separate by registering a “Incorporation”.
1.1 – Register A Corporation
First it’s important to find out the liabilities in relation to “LLC” and “Corporation” LLC stands for limited liability and you might be responsible for some debt under the LLC structure. I would consult an attorney or corporate accountant to find out the difference. Each state might have different regulations so it’s hard to give you a universal answer.
If you have an accountant you can ask them to file for you. They charge you a fee and provide their feedback. However, you can also file by visiting your state office. Again each state has their own division so it’s strongly recommended to do a quick search in Google using the following “Open a Corporation in (state)” replace “state” with your state.
1.2 – Register An EIN Number
First, what is an EIN Number and do you need one?
In the United States, individuals have a Social Security number when filing taxes. The EIN is for companies and is also known as Federal Tax Identification Number. The IRS uses this number to identify your business while filing taxes. Next, having this number will allow you to separate yourself from your business. Not utilizing an EIN number means you’ll have to use your Social Security number which would complicate things because your business will then be operating under your individual tax number instead of company tax number – the EIN.
Here are a few circumstances when you’ll need to apply for an EIN.
- You have employees;
- Your business operates as a corporation or a partnership;
- You withhold taxes on income other than wages paid to a nonresident alien;
- You have a Keogh Plan; or
- You’re involved with certain organizations listed on the IRS website.
Other than filing taxes you might require an EIN because you want to…
- Open a bank account in the name of your business;
- Apply for a credit card in the name of your business;
- Apply for business permits; or
- Furnish independent contractors a Form 1099 [PDF]. (Check with your accountant or tax professional.)
Once you receive your corporation number in the mail you can file for an EIN through IRS.gov. I prefer doing it online because it a clear step-by-step process. Here’s the direct link: Apply for EIN Now.
Here are a few more ways to complete this process:
You can apply online at http://www.federal-ein-ampplication.co. Just complete the form and submit.
You can call the IRS at (800)-829-4933 Monday through Friday from 7:00 a.m. to 7:00 p.m. For International applicants you will need to call (267)941-4099.
You can fax your SS-4 form to (859)669-5760. For international applicants you will need to fax your SS-4 form to (267)941-1040.
You can mail in your SS-4 form to Internal Revenue Service, ATTN: EIN Operator, Cincinnati, OH. 45999. For International applicants you will need to mail your SS-4 form to Internal Revenue Service, ATTN: EIN International Operations, Philadelphia, PA. 19255.