Review these 4 steps before taking action on your new trucking or transportation business.
Yes, including before purchasing your truck or vehicle.
We get calls every day from frustrated new business owners who are just starting a transportation business. These new entrants have genuinely tried to get their transportation or trucking company set up correctly in their home state and other jurisdictions but are surprised to learn that they have unwittingly made some major missteps.
For many new entrants, getting it wrong can be costly and possibly tank their new business before it starts. Incorrectly filling out state and federal forms can lead to applications being rejected. A mistake that will cost you time and money while you correct the errors and refile them.Â
Imagine making payments on your expensive new vehicle and insurance premiums, but you can’t recoup your costs because you’re struggling to correct your application errors. Your permit to operate is often delayed by months while you try to figure out where you went wrong and how to reapply correctly. If you were lucky enough to have your first customer lined up, you’ll likely miss your opportunity and lose that business.
Here’s how to avoid getting it wrong:
1. Call us and speak to a TCS compliance specialist before starting a transportation business. Do not pass go.
Many new entrants think the first step in starting a trucking or transportation business is to purchase their first vehicle. This is a very common but critical error. You’ll need to take many important steps to properly set up your transportation business — before your new company can buy its first vehicle or other assets.
Download our Starting a New Company Checklist and give us a call. Our compliance specialists are experts at setting up new transportation businesses, regardless of their home base within the United States.
Planning on transporting internationally in Mexico and Canada? We have ample experience there, too. We’re familiar with the myriad of ways this process of setting up a new transportation business can go wrong. And we’re experts at getting it right the first time.
If you’ve started down the path already. Don’t fret. Give us a call, and let us review your paperwork to see where you are in the process. We’ll help make sense of rejected applications and determine what we can do to remedy them.
The important takeaway here is: You will need to properly set up your business entity before you take any other action – including buying a vehicle. There are a lot of reasons why successful trucking companies use TCS Compliance Services.
2. Assemble your team and resources.
Once you’ve finished forming your LLC and have your tax ID in place, talk to an accountant. They will be able to answer any tax questions you may have. They can also assist with how your business can acquire assets – e.g., vehicles and other equipment – if you still need to establish business credit.
You’ll also want to consider hiring a bookkeeper who is not just familiar with but experienced with the transportation industry.
An insurance agent specializing in commercial insurance for the transportation industry should also be on your short list of important contacts. Depending on what type of transportation company you’re setting up, you may need additional insurance.
Will the DOT require your transportation business to prepare Hours of Service (HOS) records of duty status (RODS)? If so, you’ll need to select the best Electronic Logging Device (ELD) for your business.
These are just a few examples of the team members and resources you’ll need to have in place before starting your transportation business. Need help finding the right resources? Give us a call.
3. Have your TCS compliance specialist review any state or federal applications or requirements before submitting them to any government agency.
We’ll review important aspects of your business formation. For example, we’ll review how you set up your Limited Liability Company (LLC) and check your employee identification number (EIN.)
When it comes to IFTA and IRP, state jurisdictions do not make it easy to get your new business registered with IFTA and IRP the right way the first time. Finding the right information online on correcting errors is a challenge.
The best way to avoid the pitfalls of IFTA and IRP record keeping is to talk with a TCS Compliance specialist.Â
Similarly, it’s a good idea to discuss the Heavy Vehicle Use Tax (HVUT) with us before you start operating or, at the very least, before completing and filing the IRS Form 2290. The 2290 form is required when operating over a certain weight requirement. Keep in mind there are some nuances to understanding the right timing on when you should complete the 2290 form.
4. Have a plan for managing your transportation company’s federal and state regulatory compliance moving forward.
TCS provides complete trucking compliance services to help get new trucking companies up and running correctly. We also provide ongoing compliance management services to keep those new trucking companies on the road.
Not sure you need a compliance specialist? Read our TCS Customer Spotlights to see how we’ve helped new transportation businesses get on the road quickly and stay there.
With a TCS Compliance Specialist on your team, you’ll have a dedicated compliance manager who has made it their business to take care of yours.
