If your trucking company has lost drivers, you might be wondering what to do about payroll. Should you cancel it, keep it open, or just wait? What happens if you stop running payroll? Will there be tax penalties?
Many trucking companies assume that if no one is getting paid, payroll isn’t a concern. But that’s not true. Stopping payroll the wrong way can lead to IRS fines, extra fees, and compliance headaches—even if you don’t have employees right now.
In this article, we’ll break down exactly what happens to payroll when drivers leave, how to avoid expensive tax mistakes, and how to decide whether to cancel payroll or keep it running.
Payroll Tax Risks: What Happens When You Cancel Payroll?
Losing drivers is tough, and payroll might feel like one more headache you don’t need. But before you pull the plug, you need to understand something important:
🚨 Even if you’re not paying wages, payroll tax filings are still required.
Federal, state, and sometimes even local agencies still expect payroll tax reports, even when you don’t have active employees.
If you fail to file, you could be hit with:
- Tax assessments (bills for payroll taxes they assume you owe)
- Late filing penalties
- Possible interest charges
So before you cancel, let’s figure out if keeping payroll active is the better option.
Hiring a New Driver Soon? How to Handle Payroll in the Meantime
Hiring a new driver isn’t quick or easy. It could take weeks or months to find the right person. But in the meantime, payroll tax filings still need to be done—even if no paychecks are issued.
How to Prevent Tax Penalties While Waiting for a New Driver
- File a zero-wage return: This tells the IRS and state agencies that no wages were paid, keeping you compliant and avoiding penalties.
- Keep payroll open: This ensures a smooth transition when your new driver starts, so you don’t have to restart payroll from scratch.
What Is a ‘Missed Payroll Fee’—And Why Does It Matter?
We know it’s frustrating to pay for payroll when you don’t have employees. That’s why we only charge $15 per week when no paychecks are issued.
This small fee covers:
- Quarterly tax filings, so you don’t get fined for missing reports
- Compliance support, so you don’t have to stress over tax rules
- A seamless payroll restart when you hire your next driver
Bottom line: If you’re hiring soon, keeping payroll running saves you from tax penalties and extra reinstatement costs.
No New Hires? Here’s What to Do with Payroll
If you don’t plan to hire a new driver soon, canceling payroll may be the right choice. But be aware—it’s not as simple as just stopping payments.
Canceling Payroll? Here’s What You Need to Know
- The IRS and state agencies no longer expect payroll tax returns
- You stop paying ongoing payroll service fees
- You avoid the hassle of filing zero-wage returns
How Much Does It Cost to Cancel and Restart Payroll?
Before you cancel, consider the costs:
- Discontinuation fee: This covers the paperwork and tax filings required to properly close your payroll account.
- Reinstatement fee: If you restart payroll later, there’s a cost to reactivate your payroll service.
Key Question to Ask: “Will I hire a driver in the next six months?”
If the answer is yes, keeping payroll open may be cheaper and less hassle than canceling and restarting later.
Payroll: Should You Cancel It or Keep It Open?
Here’s a simple way to decide what to do:
- If you’re hiring soon → Keep payroll open and file zero-wage returns to stay compliant.
- If you’re not hiring → Cancel payroll, but understand the costs of shutting it down and restarting later.
One BIG mistake trucking companies make: Assuming they can “pause” payroll without consequences. Payroll isn’t like a subscription—you can’t just restart it without dealing with tax filings and fees.
How to Avoid Payroll Mistakes & Keep Your Best Drivers (H2)
Now you know exactly what happens to payroll when your drivers leave and how to handle it the right way. Whether you decide to keep payroll running or cancel it, the key is avoiding IRS penalties, unnecessary fees, and compliance headaches.
Many trucking companies assume they can just pause payroll when they don’t have employees. But if it’s not handled correctly, this can lead to surprise tax bills, fines, and extra costs when you restart payroll later.
The best way to avoid payroll disruptions? Keep good drivers so you don’t have to deal with this problem again. Instead of just worrying about payroll, take action to improve driver retention.
At Superior Trucking Payroll Service, we help trucking companies like yours navigate payroll, avoid tax penalties, and improve driver retention. If you need guidance on the best payroll decision for your business, we’re here to help.
Let’s keep your business moving forward—starting with keeping your best drivers.
Written by Melisa Bush
With over 15 years of experience in the trucking industry, Melisa is well-versed in the complexities of trucking payroll and adept at navigating special circumstances. Before joining Superior Trucking Payroll Service, Melisa worked at a trucking company, where she managed driver miles and expenses for a fleet of 50 trucks. This hands-on experience gives her unique insight into the challenges our clients face when preparing their payroll data.
Melisa’s top priority is customer service. She strives to treat each client as an individual with genuine needs, rather than just another number in the system. Her goal is to alleviate the burdens of our clients and make their daily operations smoother.