American driver

tasuinam

tasuinam

Well-Known Member
Apr 8, 2020
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Winnipeg
www.interlandcarriers.com
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Hi
So we have an american driver ... we are a Canadaian company... can we have him move loads within the US .. is there lic / insurance / additional paperwork requiremnets???

I tried to ask my accountant / lawyer - they have no concrete info.
Any help - advice is appreciated
Thanks
 
I think laws regarding interstating are outdated

When we have drivers cross into UK from Europe they can pickup 2 loads of domestic UK freight before having to take a load outbound from the UK destined for Europe
 
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I recall truck needed to be base plated in the U.S. in order for him to Interstate

Final words about unique drivers​

If you have special considerations such as dual citizenship, or Status Indian, you may want to consult with a United States Immigration specialist to find out what you are legally allowed and not allowed to do as a Canadian based driver using Canadian vehicles. By in large, vehicles registered in Canada are only allowed to enter the United States for international trade, not local trade.

We don’t claim to be legal experts and since violation of INS regulations has such a high cost for the driver, who is ultimately responsible to work within the legal perimeters of both INS and US Customs, seeking appropriate legal counsel is well worth the cost. Too often we hear of drivers and carriers receiving bad advice from people who only care about profit from moving the freight, rather than the driver and the resulting consequences if caught making illegal freight movements.

We hope this overview of cabotage rules for Canadian drivers helps shine some light on a rather confusing subject.

Sources and applicable law

Reprint of Cabotage rules from FMCSA

CBP guidelines for Canadian drivers
 
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As long as the driver is an American Or has the right to work in the USA, you're set. Insurance may like to know about any inter USA work you're doing but it's not a requirement. It's also irrelevant as to where the truck is plated as long as IFTA is paid and any state taxes and permits are paid and filed.
 
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That is what I thought. I had a US driver a while ago, but couldn't remember if he had our US company on the doors, or our Canadian one.
 
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bellcitytransport said:
As long as the driver is an American Or has the right to work in the USA, you're set. Insurance may like to know about any inter USA work you're doing but it's not a requirement. It's also irrelevant as to where the truck is plated as long as IFTA is paid and any state taxes and permits are paid and filed.
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Yes this is what my lawyer told me ... but hey were not 100%
 
All good points, but most are slightly off the mark.
There are two vital questions that need be answered.
1. From which country is the driver being paid?
2. Is there an IRP license plate on the truck?

The first question ... from which country is the driver being paid?
Although the driver is a U.S. citizen, and even though s/he is solely working within the U.S., if you are paying him/her from a Canadian address, said driver needs a Canadian Work Visa. No cheating the tax man.
The alternative is to pay him/her from a U.S. bank account from a physical U.S. bank (can't just pay from your USD account in your Canadian bank). However that exposes you to U.S. tax laws. Again, no cheating the tax man.

The second question ... is there an IRP license plate on the truck?
If you have an IRP license plate on the truck, even if it is a provincial IRP plate, the truck itself is totally legal to work in any country, state, or province that is a signatory to the IRP program, even if that plate is solely working in another country i.e. An Ontario IRP plate can interstate in the U.S. and never has to come back to Canada, let alone Ontario.

The long and short of it is simply this; for the hiring of one driver, the cost of set up and the tax implications are not worth it. If had about a dozen drivers though, the cost benefit would very likely be worth it.
 
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Michael Ludwig said:
All good points, but most are slightly off the mark.
There are two vital questions that need be answered.
1. From which country is the driver being paid?
2. Is there an IRP license plate on the truck?

The first question ... from which country is the driver being paid?
Although the driver is a U.S. citizen, and even though s/he is solely working within the U.S., if you are paying him/her from a Canadian address, said driver needs a Canadian Work Visa. No cheating the tax man.
The alternative is to pay him/her from a U.S. bank account from a physical U.S. bank (can't just pay from your USD account in your Canadian bank). However that exposes you to U.S. tax laws. Again, no cheating the tax man.

The second question ... is there an IRP license plate on the truck?
If you have an IRP license plate on the truck, even if it is a provincial IRP plate, the truck itself is totally legal to work in any country, state, or province that is a signatory to the IRP program, even if that plate is solely working in another country i.e. An Ontario IRP plate can interstate in the U.S. and never has to come back to Canada, let alone Ontario.

The long and short of it is simply this; for the hiring of one driver, the cost of set up and the tax implications are not worth it. If had about a dozen drivers though, the cost benefit would very likely be worth it.
Click to expand...
Thank you for clearing that - actually a dual citizen Canadian/American so legal both places
and yes IRP plates ...
 
shayne said:
I think laws regarding interstating are outdated

When we have drivers cross into UK from Europe they can pickup 2 loads of domestic UK freight before having to take a load outbound from the UK destined for Europe
Click to expand...
The laws surrounding cabotage (interstating as you called it) are not outdated. They are a political football, and they are extremely one-sided.

It is completely illegal for a Canadian carrier to take a load from Toronto to Philadelphia, unload, then move to Wilmington to pick up a load to go back to Toronto. The illegal part is moving the empty from Philly to Wilmington. However, there has been a U.S. Customs directive not to enforce this part of the rules.

On the other hand, it is completely legal for a U.S. carrier to pick up a load in Miami and deliver it to Halifax, then deadhead to Montreal to pick up a load and deliver it to Vancouver, then pick up a load in Vancouver and deliver it to Los Angeles. U.S. carriers are allowed to reposition empty in Canada, then they are allowed one loaded repositioning move within Canada, provided the carrier reloads at destination back to the U.S. (or Mexico).

To illustrate further, a U.S. carrier can pick up a load in Bangor, ME and deliver it to St. Johns, NB, deadhead to Moncton, NB, pick up a load and deliver it to Vancouver, BC. In Vancouver BC the carrier can pick up a load and deliver it to Seattle, WA where he unloads, then reloads to go back to Vancouver, BC, reload again and go back to Moncton, NB, and on, and on, and on.

If you want my personal opinion on the cabotage rules, that is a story for another day, and will take a lot more time than I have today :)
 
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tasuinam said:
so I would have to fill a W9? and then pay US taxes???? or do I need to register in the US .. that was my initial question
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All three. You would have to file a W9. You would have to pay withholding taxes for the driver, and income tax for your company. You would have to register in the U.S. as a tax paying corporation.
On top of all that, a portion of your Canadian income becomes U.S. taxable where continuous movement cross-border loads are concerned, and a portion of your U.S. income becomes Canadian taxable for the same reason.
Your local accounting firm can no longer manage your tax burden. You'll need to hire an international accounting firm that can file in both countries.
Your internal accounting practices will need to change to accommodate your increased tax burden.
The simplest, and most cost effective, way to hire a U.S. driver is to rent (or buy) office space in the U.S. and start a U.S. company.
Just went through this entire exercise myself, and the whole thing is so ugly and convoluted it's almost unfathomable. It is definitely doable, but it is certainly not for the faint of heart.
In the end, for one driver it is totally not worth it. We walked away from the opportunity.
 
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Michael Ludwig said:
All three. You would have to file a W9. You would have to pay withholding taxes for the driver, and income tax for your company. You would have to register in the U.S. as a tax paying corporation.
On top of all that, a portion of your Canadian income becomes U.S. taxable where continuous movement cross-border loads are concerned, and a portion of your U.S. income becomes Canadian taxable for the same reason.
Your local accounting firm can no longer manage your tax burden. You'll need to hire an international accounting firm that can file in both countries.
Your internal accounting practices will need to change to accommodate your increased tax burden.
The simplest, and most cost effective, way to hire a U.S. driver is to rent (or buy) office space in the U.S. and start a U.S. company.
Just went through this entire exercise myself, and the whole thing is so ugly and convoluted it's almost unfathomable. It is definitely doable, but it is certainly not for the faint of heart.
In the end, for one driver it is totally not worth it. We walked away from the opportunity.
Click to expand...
Thank you for that ... the accouting itself seems like a nightmare...
 
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