Planning on Having Your Own Authority Trucking? Here’s Everything You Need to Know - Strong Tie Insurance Services

Planning on Having Your Own Authority Trucking? Here’s Everything You Need to Know

Strong Tie Insurance March 7, 2022 Our Blog

You need your own authority to make substantial money as an owner-operator truck driver.

Sure, you may work for a leasing company, and this is a terrific method for people with bad credit to have their own truck. However, having your own truck authority can help you earn better rates on a consistent basis—and it’s required if you ever want to hire other drivers and establish a multi-truck operation.

Obtaining your trucking authority in order to start your own trucking company, on the other hand, might be a daunting task. It’s difficult to keep track of all the actions you need to take with so much conflicting information available on the internet.

Obtaining your own authority necessitates initial capital, meticulous attention to detail, and a get-it-done attitude.

Having Your Own Trucking Authority

If you’re not sure where to begin, we’ve compiled a list of the most frequently asked questions about obtaining your own trucking authority to assist you. Expect the full procedure to take two months or more.

Having your own operating authority implies you have permission from the government to earn money moving freight as your own trucking firm. The Federal Motor Carrier Safety Administration (FMCSA) issues your operating authorization in the form of a Motor Carrier (MC) number.

Depending on the type of goods being transported, several types of motor carrier authorization are required, and some carriers will require multiple authorities to cover multiple types of cargo.

If you’re moving loads within a state, certain states require intrastate authority. Make sure you apply for the appropriate operating authority or authorities for your company.

Where to Start?

Now, you might be asking yourself where to start. Below, you’ll find ways to acquire your own trucking authority.

Determine what Kind of Authority You Need

The type of goods being transported determines the authority required, and some carriers require multiple authorities to cover multiple categories of cargo. Visit the FMCSA website for further information.

If you’re moving loads within a state, certain states require Intrastate Authority.

Fill out an application for the authority or authorities that are relevant to your firm.

Think of a Name for Your Business

If your state requires it, register your business. This is usually done through the Secretary of State’s office, but double-check your state’s official website to make sure. Note that certain states require you to register your business under a fictitious name, or doing business as (DBA).

To be sure, go to your state’s official website

Create Your Business Structure

Consult an accountant to figure out how to arrange your own trucking company for maximum financial and operational success. To determine the best selection for your company, research limited liability companies (LLCs), C corporations, S corporations, partnerships, and sole proprietorships.

Get Your Employer Identification Number

You’ll need an Employer Identification Number (EIN) for tax purposes relating to your firm, so visit the Internal Revenue Service (IRS) website to get one.

Have Your Primary Liability and Cargo Insurance Preapproved

You’ll waste a lot of time and money if you wait until the end of the procedure to find out you’re not approved for insurance to protect you in the case of an accident. It is crucial not to miss this step.

Get Your MC Number

To get your MC number, you have to visit the FMCSA website.

Owner-operators should keep at least 60 days’ worth of excess cash on hand to cover operating expenses such as fuel and repairs. If you’ve been an owner-operator for a long, you’re aware that invoices can take up to 45 days to be paid. While you’re building your firm, be prepared by having operating cash on hand.

How to Acquire Your Own Trucking Authority

If you’re done checking all the factors above, you can move on to the list of items below. The fees you pay will vary based on where you live. For more information, go to your state’s Department of Transportations (DOT) motor carrier website.

1. Apply for Your Authority

Fill out the OP-1 or OP-1(P) application form, as well as the BOC-3 form, and pay the application fee. You’ll need the truck’s VIN, year, weight, tax ID number, incorporation information, and license plate information if you have it.

You’ll get your USDOT Number once you’ve completed the Motor Carrier Identification Report (MCS-150) and Safety Certification Application, which you’ll need to have a vehicle utilized in interstate commerce to transfer freight.

2. Get Your URC Permit

To apply for the Unified Carrier Registration (UCR) system, use your USDOT and MC Number.

UCR validates that you have active insurance coverage in the states where you do business.

Learn more about the UCR system and apply for your permit.

3. Pay for Your HVUT

The Heavy Vehicle Use Tax is a yearly fee levied on all heavy vehicles that travel on public roads.

When you’re ready, download the OOIDA worksheet and complete Form 2290. Before you can consent to the IRP, you must first complete this step.

4. Register for Your IRP

The International Registration Plan (IRP) is an agreement between the 48 contiguous states and Canada that allows for the payment of registration costs based on the distance traveled across all jurisdictions, allowing you to participate in interstate transportation under federal legal authority.

This process can be simplified by using the IRP website. Before you may set up an International Fuel Tax Agreement (IFTA) account, you must first have an IRP account.

5. Create Your IFTA Account

IFTA  streamlines the collection of fuel taxes. It allows you to travel between jurisdictions while also ensuring that each state receives a portion of the cash generated to support roads and transit. With an IFTA license, you only have to submit one fuel tax return to your base jurisdiction every quarter.

Some scenarios will necessitate the acquisition of additional permits. Weight distance permits are required to operate in Kentucky, New Mexico, and New York, while a permit and a surety are required in Oregon.

If you’re transporting military, government, foreign, or intermodal cargo, you’ll require the Standard Carrier Alpha Code (SCAC).

6. Enroll in a Drug and Alcohol Testing Program

The FMCSA and the DOT require all motor carriers to have a negative drug test before recruiting drivers or driving themselves. On the FMCSA website, you can learn more about the rules and regulations governing drug and alcohol testing.

Get Your Own Trucking Authority with Our Help

If you have further questions about acquiring your own trucking authority, our team of experts can answer your questions. We can also give you the best commercial truck insurance policies and the cheapest quotes.

Ready to steer your own path in the trucking industry? Gain valuable insights into establishing your trucking authority for sustained success. Dive into our blog post and chart your course towards long-term gains.

To learn more, contact our team at 866-671-5050 at Strong Tie Insurance today!