Leasing a Truck from my Boss

by Mark Gonz
(Fresno, CA, USA)

So recently I signed a lease to own deal with my boss to take over one of the trucks. However, due to poor credit and lack of funds, we did not attempt to finance the truck from the dealer. So we came to a contract that I would pay the truck every month but everything would still be under his name and when the truck was paid off I would receive the pink slip as owner.

This was stated in the contract. However, my question is if is legal for me to operate the truck under his name as well as the permits, and how can I report my income to the IRS if the truck is not under my name?

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Feb 07, 2016
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by: Mark

Oh okay I see thank you for an immediate answer. I will definetely look into it, but one thing I want to make sure of is if its okay for the permits from the truck to be under my bosses name since I cannot put the vehicles title under my name.

Feb 07, 2016
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It is legal
by: Hervy

Hi Mark,

Keep all of your records. That contract should have been sign by both of you in front of a notary.
Since it involves a significant amount of money, I would get a lawyer to look over it. Documents do have to be written in a certain way for it to be legal as well.

Like are there consequences to either one of you breaking the contract.

As far as it being legal for you to drive the truck like that, yes it is.

As far as taxes, you should get a business get an EIN from the state, https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Apply-for-an-Employer-Identification-Number-%28EIN%29-Online

Keep up with all expenses.

That owner should issue you a 1099 for what he pays you at the end of the year. Of course, you need to get proof of the payments that you make to him as well. (I suppose that will be in your check statement as well)

Bottom line is, I can not give you legal advice. I have just gave you some tidbits of information.

You should talk to a lawyer and accountant to make sure you handle all of the details. This is not a small insignificant move. It could be costly if you are not covered.

Details of insurance also have to be worked out. What happens in the event of major breakdown. What is your expectations, what is his. Are you on the same page? These are things that should be considered and agreed upon. Some people hope for the best and ignore talking about such things up front. Then if something goes wrong, there is a disagreement about how to go forward.

So go that you are asking questions. Talk to a lawyer familiar with trucking man. Search google for them in your area.

One thing to be sure not to ignore......
What type of person is your boss. If he is a stand up guy that's a good sign. If you have seen him run a shady operation, be very careful man.

I assume this is a truck that you have been driving. If that is the case, it is good for you. If this is a truck you know nothing about, I suggest you get a mechanic to look it over unless you are mechanically inclined as well.

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