From Allen Gregorson - IRS
/Courtesy MTA
Owners and operators of heavy truck/tractors are paid a fuel surcharge by the companies who lease their vehicles. The companies should include these surcharges in the Forms 1099-MISC they issue to the owner/operators. The IRS has received information that indicates that some companies may not be including these fuel surcharges in the payment amounts shown on Forms1099.
Owner/operators should check with the companies leasing their vehicles and confirm whether or not the company is including the fuel surcharges in the 1099s issued to the owner operators. Unreported fuel surcharges can be a significant issue for owner/operators since unreported income can total $30,000 to $50,000 per year for one truck/tractor. With diesel fuel at $3.00 per gallon, for example, the fuel surcharge is $0.31 per gallon.
If the amounts shown on Forms 1099 issued to the owner/operators do not include the surcharge the owner operator must nevertheless include the fuel surcharges in the income they report on their tax returns. If the surcharges were not reported for prior years, the owner/operator should file amended income tax returns to correct the oversight and avoid additional penalties and interest.
Likewise, companies who issue Forms 1099 should also check to make sure they are including the fuel surcharge in the Forms 1099 they issue. If they are not, they should file amended Forms 1099s to correct the error.
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