Smart Moves On The Road: Tips For Truckers To Avoid Tax Scams

By Ankita Tripathy

September 19, 2023

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Truckers are the unsung heroes of the supply chain, making sure goods get where they need to be on time and keeping businesses running smoothly. They are the backbone of product transportation worldwide. But, in the hustle and bustle of the trucking world, there’s a growing concern – truck scams and shady dealings. The best way for truckers to stay ahead of the game is by taking preventive measures and spotting potential threats early.

But before we dive into how you can steer clear of trucking tax fraud, let’s first navigate through some of the most common trucking scams out there.

4 Common Trucking Scams

Don’t fall for these 4 common trucking scams. Protect yourself and your cargo with our expert tips. Stay ahead of the game.

The Loading Scam

The Loading Scam

This is the main notorious player in the world of trucking schemes. It often targets companies that post their freight on load boards. Scammers assume the identity of a legitimate carrier, secure a load booking, and then ask for a fuel advance to cover transportation expenses. Once they pocket the cash advance, they vanish, leaving the broker in a financial bind.

Bogus Freight Claims

This type of trucking fraud typically happens when the driver cannot access the loading dock and the trailers are sealed for security. Be extra cautious when drivers aren’t allowed to oversee the loading process or verify the cargo, yet they’re pressured to sign off on the piece count. The deception unravels upon delivery when the actual quantity of freight falls short.

The Transportation Authority Scam

There are two versions of this one.

In the first, scammers pose as Department of Transportation representatives or on-site law enforcement officers conducting an inspection. They demand immediate payment for a fake violation.

In the other version, scammers send a letter to the trucking company, insisting on payment for processing their DOT renewal. The letter comes with threats of fines if the company doesn’t comply.

Illegal Tax Schemes

These schemes aim to pressure truck drivers into incorporating themselves as businesses, allowing them to sidestep taxes while losing standard employee rights related to health and safety compliance.

This underhanded tax scheme pushes trucking firms to create their own corporations, leaving drivers without entitlements such as overtime pay, paid sick leave, vacation time, and severance pay. It also leaves them without essential protections in case of workplace injuries, making them vulnerable to arbitrary terminations.

Tips For Truckers To Avoid Tax Scams

Tips For Truckers To Avoid Tax Scams

Your safety and that of your fellow truckers should always come first. Stay sharp, keep an eye out for common tricks, and use these simple tactics to protect yourself and your cargo while you’re on the open road.

Get to Know Your Brokers

Understanding your broker’s track record is key. Know your broker inside and out. Know their payment patterns and risk levels. Their creditworthiness is crucial when evaluating their performance. Consider getting some expert advice from a trucking tax specialist.

And if you’re feeling extra cautious, think about partnering with a non-recourse factoring company. It’s like an insurance policy for your payments and will give you peace of mind even if your broker decides to take an unexpected detour.

Vet Your Business Partners

Before you hitch your wagon to any business, do your homework. Investigate your potential partners thoroughly. Verify their information, dig for reviews, and chat with someone from the company. If something doesn’t sit right, there are plenty of other fish in the sea. Never feel like you are being too cautious; you are simply covering yourself from bad luck.

Beware Of Suspicious Rates

If the rates sound too good to be true, they probably are. Compare them to others to spot any oddities. Compare them to market averages and use rate comparison tools. Be especially wary of those offering rock-bottom prices; these are often the bait for tax scammers.

Don’t Skip The Fine Print

Don’t just skim through those contracts; read them thoroughly. Keep an eye out for tricky phrases like “detention pay” and “truck ordered not used.” They might limit your ability to claim what’s rightfully yours. If something seems off, don’t hesitate to negotiate the terms and ask questions.

Time It Right

When agreeing to a transport load, make sure to allow sufficient time for pick-up and delivery. Avoid violating the Hours of Service (HOS) regulations. If the timing doesn’t add up, consider passing on the load altogether. Going over your hours is a risk that is just not worth taking.

Plan Your Route Carefully

Know the best route to your destination to avoid risky and accident-prone areas. A well-planned route also makes finding a spot for breaks or overnight stays a breeze.

Maintain Communication

Brokers often want regular check-in calls to track your progress. Keep the lines of communication open; it helps to build trust. And, for added security, consider using GPS tracking for your cargo and transport device. It allows you to monitor movement from pick-up to delivery and keeps those scammers at bay.

Keep Detention Time Records

Truckers typically grant both shippers and receivers a standard two-hour window before detention time begins accumulating unless an alternative agreement is reached. Track your waiting times, and make sure you have evidence. Get someone at the pick-up and delivery sites to sign and timestamp your arrival. This protects you from tampering incidents, fraudulent fees, and cargo theft.

Prompt Documentation

Once you’ve made the delivery, send over all the paperwork straight away, including your invoice. This ensures that you get paid without any unnecessary delays and provides proof that you’ve done your job.

In Conclusion

Whether you’re a seasoned pro or just starting in the trucking game, tax scams can catch anyone off guard. Sadly, it is all too common for carriers to find themselves hauling what seemed like a legit load, only to realize they’ve been scammed.

Stay sharp, trust your instincts, and always be thorough in your assessments. It’s not just your money on the line; it’s your reputation as a top-notch professional trucker too. Safe travels!

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Ankita Tripathy

Ankita Tripathy loves to write about food and the Hallyu Wave in particular. During her free time, she enjoys looking at the sky or reading books while sipping a cup of hot coffee. Her favourite niches are food, music, lifestyle, travel, and Korean Pop music and drama.

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