Trucking companies are regulated by the Department of Transportation (DOT) and the Federal Motor Carrier Safety Administration (FMCSA). When opening a trucking company, you must follow the state and federal business guidelines required when opening a business as well as the specific requirements for interstate and intrastate transport. Some of these documents will be maintained at the business's office and others will be required to be in the vehicle as you operate.
State Business Registration
Before you can apply for the DOT license and any permits needed for the type of operations you plan to do, you need to be legally registered as a state business. This is accomplished via the secretary of state office or website for your specific state. Once your business name and structure are properly registered, your business entity is established.
Internal Revenue Service Tax Identification
Just like people have Social Security numbers, businesses have tax identification numbers that the IRS uses to track businesses. This number can be obtained online through the IRS website and is usually a simple process. The tax identification number is necessary when you open your business's bank accounts or apply for permits and licensing.
Commercial Driver's License
The person driving the commercial vehicle must maintain a valid Commercial Driver's License (CDL). There are three different classes of CDL that the driver could have depending on the type of vehicle he/she is operating. Prior to hiring a driver, you must also check their Clearinghouse to check for past positive drug or alcohol tests. Drivers must also have a clean driving record.
USDOT Number
The USDOT number registers the business with the DOT, and allows for easy tracking with your safety scores. You'll receive your USDOT number and will be issued a provisional permit until the completion of an 18-month New Entrant Safety Assurance Program. After completing the program, your number and permit become permanent. The originals will be kept in your business's office, but placing a copy in your vehicles and having the number stenciled on the outside of the truck will also be required. Often times, the USDOT number and Motor Carrier (MC) number will be placed under the company logo.
For more information about the placement and requirements of USDOT numbers, please reference 49 CFR 390.21T.
Commercial Liability Insurance
You must have a $75,000 surety bond and a general liability policy that protects from liability and cargo loss at a minimum of $750,000. Insurance cards should be kept in the truck, similar to personal vehicles, with the declarations pages maintained in the office.
Heavy Highway Use Tax Return, Form 2290
For trucks over 55,000 pounds, the IRS requires a special tax return for infrastructure budgets, this form is referred to as the 2290. Credits are available if you drive fewer than 5,000 miles annually, but most big rigs are required to complete this form and pay the tax.
State Transportation Permits
Each state has its own cargo and transportation permit requirements. Check with your local DMV to see which permits are required for your specific type of transport. You may need permits for hazardous cargo, oversize or oddly sized cargo and for crossing state lines. Be sure you keep any and all permits in the truck relating to your cargo at the time. In the event you are stopped you will be asked to produce them.
Front Range Compliance Services
At Front Range Compliance we specialize in DOT Compliance Management and Training. Outside of registering your business with your state, getting a tax identification number with the IRS and obtaining commercial liability insurance, we can help you with all of these documents in getting your business started as well as managing your compliance programs after your company is up and running. We can recommend insurance brokers to you that are best suited to help you with your business's needs. After your trucking company is set up, we are here to help you with training and all DOT compliance needs!
Make sure to check out our online DOT Training platform, DOT University! We currently are offering Reasonable Suspicion for Supervisors, Cargo Securement, Defensive Driving, and Pre/Post Trip Inspection. In the coming months, we plan on releasing DOT Compliance Essentials and Appendix A.
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