sub contracting?

[woodsracer144]

Hey I need some help, I was offered to be a boumatic dealer but I would be subcontracted to another guy who is a distubitor. Now would it be smart for me to do this? Never been part of a subcontract. Also should I use one of their trucks or use my own and use the tax write off on my own taxes?" Not saying im gonna get rich but id like to make as much as I can and get the most of it.

[Tommy Warren]

how many miles are you running every day? the tax savings probably won't add up to the price of a new truck every year + wear and tear, oil changes, repairs, gas, and if your using your vehicle for work the insurance will probably go up....

[quad2xtreme]

Originally posted by woodsracer144
Hey I need some help, I was offered to be a boumatic dealer but I would be subcontracted to another guy who is a distubitor. Now would it be smart for me to do this? Never been part of a subcontract. Also should I use one of their trucks or use my own and use the tax write off on my own taxes?" Not saying im gonna get rich but id like to make as much as I can and get the most of it.

If they give you a mileage allowance for using your truck then I might consider it. If you entire payment for using your truck comes from writing down mileage as a business expense, I'd go with them providing the truck.

If they reimburse you 52 cents a mile then you are recovering the cost to use you vehicle (all things considered). If your write that off on your taxes then you only save a portion of that (your tax rate X the 52 cents a mile).

[derekhonda]

Answer is their truck.

Their insurance, their gas, their repairs, all on them.

Any personal use you gain out of the vehicle (non work related) needs to be calculated, and then it is added to your taxes at the end of the year.

How it would work is (and someone correct me if I am wrong):

If you drove 20,000 miles in a year, 10,000 personal, 10,000 work, the government tax rate is 5.2 CENTS! per mile. That would be $520.00. Then there is a formula for the cars value, if it is a $30,000 truck it might be 4 or 5 grand.

So, if you made $40,000 last year, your actual tax basis would be like $45,520 (40k + 5k vehicle + 520 mileage)

Then you pay tax on that addition $5,520, which might be like $1000.00 So you got a truck to drive, repair free, insurance free, and gas free for $1000.00, quite the deal.

[derekhonda]

And to answer your other question, being his subcontractor you are just making him money. Make sure your deal is absolutely set in stone and you are happy with it, sometimes those ring leaders like to run away with all the profits you made him.

[woodsracer144]

yeah, Its for a cousin of mine, there were two boumatic dealers around here about 60 miles apart my cousin was the head of one and there is a guy who managed both, so now the one that my cousin was the head of both them bought it out in DEC. so its all new, its both those guys being a boumatic dealer for about a 70 Mi radi. around each town. so far i just went to a few stops to talk things over and see what it was all about. ( i milked cows before but i didnt know what my job there would deal with selling, installin, repair) and i'd just run like anything rubber that wears out from normal milkings, hoses, inlfations and all that and then i'd check vac pressure's and make sure its right for how many head they have. and stuff

he said for the start he would pay me 10 bucks roughly, maybe alittle more but they still have alot to do money wise to take care of before they would go under but he said this would be a long haul deal if i would want to do it cause after i get done with school ( welding) i would be one of the installers and put in all the SS pipe and ****.

He said they had a 3/4 ford cargo van i could prolly use but i dont know if they own it them selfs already or if they are buying it.

I have a fummins and i have a inclosed trailer i could get my hands on

I was thinking useing that van for a little while untill it dies or something and then get a truck just for work ( 96,97 psd or else use my Ford cummins i have and get a different everyday driver)

I know he wont shake me around just because i know him really well but at the same time for a little while im gonna have to scrach his back for a little bit before they can really pay me because they are building a new store kind of where i live.

so now what do you think would be wise? im gonna go talk with my tax lady about it and see what she says also.

[CJM]

Id make them provide oyu with a truck. As already noted, they pay all costs related to the truck then. You might get paid less, but its a better deal.