Fedex Overtime Lawsuit Attorney

Fedex Drivers – How Much Money Should I Save for Taxes?

A lot has been made recently in regards to Fedex Ground’s classification of its delivery drivers as independent contractors as opposed to employees. As has been covered both in our writings and in media reports all over the world, Fedex Ground has been taking a beating in court rooms all over the United States in regards to this classification. Not only has Fedex Ground faced the possibility of paying enormous amounts in damages, but they have also been charged with back taxes by the California taxing authority.

However, we’d like to shift the focus away from this growing list of defeats for Fedex Ground for the moment and offer you some basic advice in regards to how to plan your finances while you are an independent contractor. Simply put, the federal government and state taxing authorities still expect you to file your tax returns accordingly regardless of how this issue may resolve itself for you either soon or years down the road.

Potential Deductions from Your Income

As we’ve covered in previous writings, when you work as an independent contractor, you are in effect operating as a small business. This means that all, or at least many, of the expenses you incur in furtherance of your business pursuits could possibly be deductible from your income. These expenses include your delivery truck, your uniform, insurance that relates to your health and your liability protection, phone lines and any other expense that is related to your work. These deductions are critical, as they can significantly lower the amount of tax liability you ultimately face when you file your return.

How Much Should I Set Aside?

We mentioned the potential deductions above because you need to keep track of these expenses. However, in order to make sure that you’re not surprised with a tax bill that could be larger than you expected, you should not take these expenses into account when deciding how much to save as you move through the tax year.

What you should do is contact Pulaski & Middleman, as the firm will be able to help you determine which tax bracket will be the one in which you’re placed based on your income. Based on that percentage, that’s how much you should save. For example, if you make $50,000 per year and fall into a 20% tax bracket (Note – this is only an example, and not to be taken as the actual amount), then that would mean that at the end of the year, you’d owe $10,000 in taxes to the IRS.

Again, this does not take your potential deductions into account, and that’s not an accident. If you save $10,000, and then you deduct your expenses at the end of the year, it’s likely that you won’t have to pay as much, which creates a financial bonus for you. It’s much better than the alternative, which is to owe the IRS and your state taxing authority money, which is something you never want to do.

If you have any questions regarding the entire issue that surrounds Fedex Ground delivery drivers, contact the Fedex overtime attorneys at Pulaski & Middleman today to schedule a free initial consultation.