Trucking Business Checklist

Starting a Trucking Business Checklist – License and Permit Information

Trucking businesses have many of the same startup processes as a typical business. You’ll need to choose whether you want to form an LLC or corporation, whether to use a business formation service, etc. In addition, there are some specific steps for this unique industry.

#1) Get a truck

Obviously, it’ll be impossible to start a business in the trucking industry unless you own or lease at least one truck. Easy as it sounds, however, it’s not as simple as going out and purchasing a truck. You need to make sure you acquire a vehicle that’ll suit your specific purposes and won’t break down. Here’s a list of things to keep in mind.

• Look in multiple places when you’re choosing which truck to purchase. Always compare prices so you don’t overspend on your first-ever purchase. As a small business owner, you might not have much cash to throw around.
• Don’t be afraid to negotiate with the seller. Many sellers are willing to haggle a little bit because everyone wants to find the best price. Don’t be ashamed of getting a good bargain!
• Make sure you get a mechanic to look at the truck before you purchase it. There could be minor faults that’ll impact you in a major way later on, so get them sorted out in the beginning.
• Understand your budget and don’t be afraid to ask the seller for a payment plan. You might not be able to pay the full amount right away.

#2 Get a commercial driver’s license (CDL)

As the owner-operator of a newly started trucking business, you’ll need to obtain a commercial driver’s license (CDL) for yourself (if you’re driving) and your drivers. Additionally, you’ll need to acquire certifications to operate your trucks on U.S. highways. Obtaining a CDL isn’t too difficult and it’s a requirement in America and Canada when operating commercial vehicles.

Anyone who’s driving will need to have a clean driving record and pass drug tests. Of course, this is to ensure quality and safety standards. You can apply for the CDL through your local DMV.

#3 Apply for a USDOT Number

If your company operates commercial vehicles that transport people or haul cargo across multiple states, you’ll need to be registered with the Federal Motor Carrier Safety Administration (FMCSA). According to the FMCSA, your USDOT number is a unique identifier used for auditing, investigations, inspections, and compliance reviews. You’ll need to comply with federal regulations and getting this identifier is the first step.

Once you get the number, you’ll get a permanent permit. You should keep the original copy at your office, but paint or stencil the number onto your truck as well. This will help the authorities identify your rig and keep you out of trouble.

#4 Complete the Unified Carrier Registration (UCR) process

According to the Department of Transportation (DOT), if you operate a truck or bus in interstate or international commerce, the federal Unified Carrier Registration Agreement (UCR) applies to your business. This system ensures active insurance coverage in all states where a driver operates. You can register for it with your DOT number and Operating Authority (MC) number. If you need more information, check out the local DMV in your state!

#5 Obtain an International Registration Plan (IRP) tag

According to the DMV, you need an IRP license plate if you want to operate your vehicle in more than one state and in Canadian provinces. When you register your vehicle, you’ll get a cab card and one tag for your rig. There’s an annual fee for this tag but it varies from state to state.

#6 Familiarize yourself with the Heavy Highway Vehicle Use Tax

If you start a trucking company and operate vehicles that weigh over 55,000 pounds, you’ll be subject to the Heavy Highway Vehicle Use Tax, according to the Internal Revenue Service (IRS). It’s important to comply with these taxes and in order to do so, you must fill in and file the 2290 tax form on an annual basis.

#7 Acquire an International Fuel Tax Agreement (IFTA)

The purpose of the IFTA is to have one consistent fuel tax license for all of your trucks in IFTA jurisdictions. This means you only have to file a single tax return per quarter when you report your fuel usage and mileage. You can register for this online and once you pay the required fees, you’ll be good to go.

#8 File Form BOC-3

If you want to obtain operating authority across U.S. states, you’ll need to register a BOC-3 form with the FMCSA. According to the FMCSA, only a process agent can file the form on their client’s behalf. This is a person in each state who acts as a legal agent to take care of any and all legal complaints and issues. Find more information about this form by visiting the FMCSA website.

#9 Obtain a Standard Carrier Alpha Code (SCAC)

Lastly, if you want to transport goods internationally or intermodally, you need a Standard Carrier Alpha Code. If you don’t have a SCAC, it’s likely that you’ll have a hard time finding many clients. This code identifies transport carriers to authorities in the industry and creates a system of trust for all stakeholders. You can apply for the SCAC through the National Motor Freight Traffic Association (NMFTA).