Starting a Trucking Business? How to Get Your Operating Authority

If you are starting a trucking company, an “MC” number is your authority to operate. There are also “FF” and “MX” numbers depending on the type of trucking business you hope to run and the kinds of authority you need to do so.

These numbers, known as proof of Operating Authority, are required by law for certain trucking companies and dictate the type of operation a company may run and the cargo it may carry. These numbers are regulated by the Federal Motor Carriers Safety Administration and the United States Department of Transportation and only apply to carriers shipping federally regulated commodities. If your trucking company ships federally regulated commodities or transports goods across state lines, you very likely will need to obtain an Operating Authority number in order to stay legal.

There are also a variety of trucking companies that do not need to worry about obtaining a federally approved Operating Authority. Trucking companies that do not need an Operating Authority number include private carriers that transport their own cargo, for-hire carriers that exclusively haul commodities that are exempt from federal regulation, and carriers that operate exclusively within a federally designated “commercial zone” that is exempt from interstate authority rules.

Knowing whether your trucking company needs an Operating Authority is important because it determines the type and level of insurance you will have to obtain. The FMCSA does not refund applications so be sure to only apply for the Operating Authority that is relevant to the type of business you run.

Trucking companies that definitely need to apply for Operating Authority include for-hire carriers that charge for their service, carriers that transport passengers in interstate commerce, and carriers that transport federally regulated commodities or arrange for their transport in interstate commerce. These types of carriers will need to obtain an FMCSA Operating Authority number as well as a DOT number.

Applying for Operating Authority can be time consuming and there are no refunds so be sure to establish the type of trucking business you are going to run before you apply.

What should owner-operators do to prepare for delayed invoice payments?

To properly prepare for delayed invoice payments, it is highly recommended that owner-operators have a sufficient amount of extra cash set aside. Specifically, it is advisable to have at least 60 days’ worth of operating costs covered, which includes expenses such as fuel and repairs. It is important to note that the timeline for receiving payment on invoices can often span from 30 to 45 days. By proactively anticipating and being prepared for this delay, owner-operators can safeguard their businesses by ensuring they have readily available operating cash while their business continues to grow.

What are the benefits of having my trucking authority?

Having your own trucking authority offers a multitude of benefits that can significantly enhance your career as a trucker. Not only does it bring about immense career growth opportunities, but it also provides you with unparalleled independence and the potential for increased earnings if managed effectively. While obtaining your trucking authority entails more work and responsibility, it grants you the freedom to hire your own drivers, expanding your trucking business over time and allowing you to operate multiple trucks with an entire team of drivers. Additionally, having your own authority means that you will be responsible for sourcing and negotiating loads, giving you greater control over your operations. In this regard, utilizing platforms like the Truckstop Load Board can serve as a cost-effective means for new owner-operators to find freight, presenting an excellent opportunity to build and expand your business. Overall, obtaining your own trucking authority can open doors to substantial career advancement, increased independence, and the potential for greater financial success in the trucking industry.

What does it mean to have your own trucking authority?

Having your own trucking authority means that you have obtained the necessary permission from the government to transport freight and receive payment for your services as an independent trucking company. This authority is granted by the Federal Motor Carrier Safety Administration (FMCSA) in the form of a Motor Carrier (MC) number. Obtaining your own operating authority is crucial as it enables you to legally operate as a freight hauler, ensuring compliance with all relevant regulations and requirements.

The type of cargo you intend to haul plays a significant role in determining the specific motor carrier operating authority that you need. There are different categories of operating authority based on the nature of the cargo being transported, and it is essential to identify the appropriate authority or authorities that pertain to your specific business. In some cases, carriers may require multiple authorities to cover different types of cargo they transport. Additionally, certain states may mandate Intrastate Authority if you plan to move loads solely within their borders.

Applying for operating authority is a vital step in starting your own trucking business. It is important to initiate the process promptly, as it typically takes considerable time – often up to two months – to complete. Delaying the application could hinder your ability to legally operate and transport freight, potentially resulting in financial losses or penalties.

In summary, having your own trucking authority means that you have obtained official approval from the FMCSA to operate as an independent trucking company and receive payment for hauling freight. This authorization is essential for complying with regulations, and it allows you to establish your business and transport cargo in a legally compliant manner.

Learn more about starting a trucking business.

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