Hay transporting (similar to previous topic)

Following this thread:
https://forums.yesterdaystractors.com/viewtopic.php?t=1636219

My situation is a little different.
I'm using my truck and my time. But - pulling the buyer's trailer. (The seller is loading me in the field.) I am using buyer's tractor to unload trailer and stack bales in his barn.

The buyer is paying me for the hauling and my time. Round trip per load is 28miles and 1.5hours time.
How would you charge for time and vehicle?

My thought was $25/hr for time, plus the federal mileage rate $0.655 per mile.
*Note* this is a side business, so I'm reporting it as income.

Personally I think you are under compensated at those rates. Also, Im not sure what kind of truck youre talking. If it is a semi, then the federal mileage rate probably wont even pay for your fuel. If
your truck is a pickup, it might pay for the fuel but not much more. Another consideration, what happens when your truck breaks down and needs repair? How much will that cost? I believe the
federal mileage rate is for easily calculating tax deductions by the mile rather than the more accurate process of deducting the actual costs.

I don't think the Federal rates are intended to figure the truck cost for a business to charge, as you are describing yours. I think as a business you would charge $X per hour, not mileage, for truck and driver. The truck is working the same hours as you are. Are you considering the truck is included with your labor in the $25 per hour? I would consider that low for what you are doing. Right now, it sounds like you are getting $55.84 per round trip of 28 miles ($37.50 in labor and $18.34 for your truck use or 37.23 per hour.) What do you have for a truck, fuel use, service, wear and tear? What is his trailer?

A good tax advisor/accountant could answer best on how you should charge. You are using his trailer and equipment, if something goes wrong traveling, loading or unloading are you an independent contractor, employee or just a friend doing a favor? What are you carrying for vehicle insurance purposes, a commercial policy that covers how you are operating?

Not saying anything right or wrong about what you are doing, just that there are some other things to consider in figuring your cost and what to charge that you didn't mention.

This post was edited by Jim.ME on 08/25/2023 at 04:10 pm.

most customers for hay that I have not sold hay to thought hay moving was a free enterprise entered into for experience and to help aleviate excess time and
money from me. price for the hay, quality and size of rolls was fine, but delivery is supposed to be free, so my advice is, get paid enough to make it worth
while or stay home. You will lose nothing doing nothing. If you want to help a friend, that is up to you.

Check your insurance. Might not be covered using somebody else trailer.

-Tony in SD
Good points, thank you. I hadn't considered the difference between cost and deductions.
My vehicle is a Ford 3/4 ton, 23 years old. It's always got something wrong with it...

Jim.ME
Thanks for the reply. Fair questions.
It's a 'messy' thing. Truck is personal. My time is business. The trailer is owned by buyer's business.
Truck breakdowns are my expense.
Trailer breakdowns are are his expense.

-Leroy
Good point. I should do that. It's 17,000lbs on the state highway. There's plenty that could go wrong.