STPS

What do I do if my truck drivers say they only want to be 1099 and not W-2?

We all know how hard it can be to find and keep a truck driver.  You probably know it better than anyone.  It’s hard.  But what do you do when the driver insists on being paid 1099 for doing company driver work that should be W-2?

It’s a tricky spot to be in since you don’t want to lose the driver and you need to fill your trucks.  Often, this driver will start with a story like “At XYZ Trucking they always let me get paid 1099” or “My ex is collecting too much child support and I don’t want them to find me” or “It’s easier for you to pay me without taxes being taken out”.  You should say NO! To all of that and here is why.

All these explanations of why you should pay the truck drivers 1099 and not W-2 are ways for the driver to benefit financially while putting you at risk.

Let me explain.  If you fail to pay the driver W-2 when you are supposed to pay them that way, the IRS will start by knocking on your door and not the driver’s.  The driver can even turn you in to the IRS with a simple form and claim to be a victim when they asked for 1099 pay.  The truck driver can say that they were unaware of the meaning of being paid 1099 even though they signed an agreement spelling it out or formed an LLC to get them out of W-2 pay.

Another issue is that your workers compensation insurance may not cover them in the event of an accident.  This is more you’re your truck insurance agent to discuss with you than us but if they policy doesn’t pay the owners can be held responsible for the medical costs.  (As an aside, this is why you want to use a great trucking insurance agent.)  One wreck like this can ruin you financially.

Finally, let’s look at the truck driver that wants 1099 pay when they should be W-2

The driver is trying to get out of either a tax obligation or a debt to someone else.  They are trying to use your payments as a way to avoid paying someone what they owe them.  If they are willing to do that, what stops them from selling 25 gallons of diesel from your fuel card into someone else’s tank at the truck stop for $25 cash in their pocket.  If they will not honor their other financial obligations, they won’t honor the ones to you either.  Especially if they are upset about a load or a raise they feel they have earned, they will take it into their own hands, like they would by trying to be paid 1099.  Is that the kind of truck driver you want?

We get it. Truck driver recruiting is hard.  But, recruiting and keeping the wrong drivers will cost you more money than not hiring the wrong ones in the first place.  Check out our resources in this blog about it for help recruiting and retaining good truck drivers.

Written by Mike Ritzema


With over 20 years of experience in entrepreneurship, management, business planning, financial analysis, software engineering, operations, and decision analysis, Mike has the breadth and depth of experience needed to quickly understand entrepreneurs’ businesses and craft the most suitable solutions.

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