Truth-in-Leasing Rules for Owner-Operators
A carrier that uses your truck must have a written lease with you that meets 49 CFR 376.12. The lease must state your pay, promise payment within 15 days after you turn in the delivery documents, list every charge-back, and cover insurance and escrow. The rules protect owner-operators who lease on to a carrier. They do not decide whether you are an employee or an independent contractor.
Facts checked October 16, 2026
Key Points
- An authorized carrier may use equipment it does not own only under a written lease that meets 49 CFR 376.12. Both parties sign, and each keeps a copy (49 CFR 376.11(a) and 376.12(a) and (l))
- The lease must say when it starts and ends. A receipt that names the equipment and the date and time must be given when the carrier takes possession (376.11(b) and 376.12(b))
- During the lease, the carrier has exclusive possession, control and use of the equipment and takes complete responsibility for operating it (376.12(c)(1))
- Your pay must be stated on the lease or an addendum, and you must get it before any trip. It can be a percentage of gross revenue, a rate per mile or another method you agree on (376.12(d))
- The lease must say you will be paid within 15 days after you submit the necessary delivery documents. The carrier may not set a time limit for sending them (376.12(f))
- Every item the carrier may deduct from your pay must be listed in the lease, with how the amount is figured. You may ask for the documents that show a charge is valid (376.12(h))
- You may not be required to buy or rent products, equipment or services from the carrier as a condition of the lease (376.12(i))
- If the carrier holds an escrow fund, it must pay interest at least every quarter and return the fund within 45 days after the lease ends (376.12(k))
- The leasing rules do not decide whether you are an employee or an independent contractor (376.12(c)(4))
What a lease under 49 CFR 376.12 must cover
| Rule | What the lease must say | |
|---|---|---|
| Parties and signatures | 376.12(a) | It is made between the authorized carrier and the owner of the equipment, and signed by both or their representatives |
| Start and end | 376.12(b) | The time and date, or the circumstances, when the lease begins and ends |
| Control of the equipment | 376.12(c) | The carrier has exclusive possession, control and use, and complete responsibility for operation, during the lease |
| Pay | 376.12(d) | The amount for the equipment and driver, on the lease or an addendum, delivered before any trip |
| Who pays for what | 376.12(e) | Fuel, fuel taxes, empty miles, permits, tolls, ferries, detention, accessorials, base plates and licenses, and who loads and unloads |
| Payment period | 376.12(f) | Payment within 15 days after you submit the necessary delivery documents |
| Freight bill copies | 376.12(g) | If you are paid a percentage of gross revenue, a copy of the rated freight bill at or before settlement |
| Charge-backs | 376.12(h) | Every item that may be deducted from your pay, and how each amount is figured |
| Buying from the carrier | 376.12(i) | You are not required to buy or rent anything from the carrier to get the lease |
| Insurance | 376.12(j) | The carrier's duty to carry public liability insurance, who provides other coverage such as bobtail, and any charge-back for it |
| Escrow | 376.12(k) | The amount, what it can be used for, accountings, quarterly interest and return within 45 days after the lease ends |
| Copies | 376.12(l) | The carrier keeps a copy and puts one on the truck, or carries a statement. The owner keeps a copy |
Who do the truth-in-leasing rules protect?
They apply when an authorized carrier uses equipment it does not own. That is what leasing on to a carrier means. The owner of the truck is the lessor, and the carrier is the lessee. The lease can cover the truck alone or the truck and the driver's services (49 CFR 376.11 and 376.12(d)). The carrier must follow the required terms (376.12). Some leases and carriers are exempt under subpart C of Part 376, and equipment interchange between carriers has its own rule in 376.31. If you run under your own authority with your own truck, you are the carrier, and these rules do not apply to your own equipment.
What must the lease say about your pay?
The lease, or an addendum attached to it, must clearly state what the carrier pays for the equipment and the driver's services. You must receive it before any trip. The pay can be a percentage of gross revenue, a flat rate per mile, a rate that depends on direction or commodity, or another method you both agree on (49 CFR 376.12(d)). The lease must also say who pays for fuel, fuel taxes, empty miles, permits, tolls, ferries, detention, accessorial services, base plates and licenses, and who loads and unloads (376.12(e)). If you are paid a percentage of gross revenue, the carrier must give you a copy of the rated freight bill at or before settlement. The lease must let you examine the carrier's tariff or the documents that show how rates are figured. The carrier may remove the names of shippers and consignees (376.12(g)).
How fast must the carrier pay you?
The lease must say you will be paid within 15 days after you submit the necessary delivery documents for a trip (49 CFR 376.12(f)). The carrier may require only your required DOT logs and the documents it needs to collect from the shipper before it pays. It may ask for more documents, but not as a condition of payment. It may not make payment depend on a bill of lading with no exceptions, and it may not set time limits for you to send the delivery documents. At the end of the lease, the carrier may hold final payment until you remove its identification devices and return them, or send a letter saying they were lost or stolen.
What can the carrier deduct from your pay?
Only what the lease lists. The lease must name every item the carrier may pay first and then deduct, and explain how each amount is figured. You are entitled to copies of the documents needed to check that a charge is valid (49 CFR 376.12(h)). For cargo or property damage, the lease must state the conditions for a deduction. The carrier must give you a written explanation and itemization before it takes any deduction (376.12(j)(3)). You cannot be required to buy or rent products, equipment or services from the carrier as a condition of the lease. If you agree to buy or rent something from the carrier and it deducts the payments, the lease must spell out the terms (376.12(i)).
What are the rules on escrow funds?
A carrier does not have to ask for an escrow fund. If it does, the lease must state the amount, what the fund can be used for, and how the carrier will account for it, either on each settlement sheet or in a monthly report. You may ask for an accounting at any time. While the carrier holds the fund, it must pay interest at least every quarter. The rate must be at least the average yield on 91-day Treasury bills from the weekly auction. The lease must state what you have to do to get the fund back. The carrier may deduct only obligations the lease names, must give a final accounting, and must return the fund no later than 45 days after the lease ends (49 CFR 376.12(k)).
Who pays for insurance and fines?
The lease must state the carrier's legal duty to carry public liability insurance under FMCSA rules. It must also say who provides any other coverage, such as bobtail insurance, and the amount of any charge-back to you for insurance. If you buy insurance through the carrier, the carrier must give you a copy of the policy on request and a certificate that shows the insurer, policy number, dates, coverage, your cost and the deductible (49 CFR 376.12(j)). For fines, the carrier takes the risk and cost of overweight and oversize fines when a trailer is pre-loaded or sealed, the load is containerized, or the trailer or load is otherwise outside your control. It does the same for improperly permitted overdimension and overweight loads, and it must reimburse you. The exception is a violation caused by your own acts or omissions (376.12(e)).
Who controls the truck, and does that make you an employee?
During the lease, the carrier has exclusive possession, control and use of the equipment, and takes complete responsibility for operating it (49 CFR 376.12(c)(1)). The rule says this does not affect whether you or your driver are an independent contractor or an employee. An independent contractor relationship may exist when the carrier complies with 49 U.S.C. 14102 and the related rules (376.12(c)(4)). Your tax and employment status is a separate question, decided under other laws. Ask your accountant or a lawyer.
What copies and records should you keep?
Keep your copy of the signed lease (49 CFR 376.12(l)). Keep the receipt that shows the date and time the carrier took possession of your equipment, and the one for when it ended, if your lease requires one (376.11(b)). Keep each pay addendum, the rated freight bills you are given when you are paid a percentage, and the documents behind every charge-back. If an escrow fund is held, keep the accountings. The carrier must keep a copy of the lease and put a copy on the truck. It can carry a statement instead that names the owner, the date and length of the lease, any limits on commodities and where the original is kept (376.11(c)(2)).
Related Free Tools
Cost Per Mile Calculator
Know your exact CPM — fixed, variable, and break-even rate.
Owner-Operator Earnings Calculator
Project weekly, monthly, and yearly take-home after taxes and expenses.
Lease vs Buy Calculator
Compare total cost of ownership: buying vs lease-to-own over the full term.
Detention Pay Calculator
Find out how much detention time you are owed, then copy a ready-to-send message for your broker.
Frequently Asked Questions
What is the difference between leasing on to a carrier and running your own authority?+
When you lease on, the carrier uses your truck under its authority. It has exclusive possession and control of the truck during the lease and takes complete responsibility for operating it, and it must carry public liability insurance (49 CFR 376.12(c) and (j)). When you run your own authority, you are the carrier. You hold the operating authority and file your own insurance, and you follow the carrier rules yourself. The leasing rules protect you in the first case, not the second.
How long does a carrier have to pay an owner-operator?+
The lease must say payment will be made within 15 days after you submit the necessary delivery documents for a trip (49 CFR 376.12(f)). The carrier may require only your DOT logs and the documents it needs to collect from the shipper before paying, and it may not set time limits for you to submit them.
Can a carrier make me buy insurance, fuel cards or equipment from it?+
Not as a condition of the lease. The lease must say you are not required to buy or rent products, equipment or services from the carrier to get the lease (49 CFR 376.12(i)). If you choose to buy or rent something from the carrier and it deducts the payments, the lease must spell out the terms, and charge-backs must be listed with how each amount is figured (376.12(h)).
Can a carrier hold an escrow fund from an owner-operator?+
Yes, if the lease says so. The lease must state the amount, what it can be used for and how the carrier will report on it. The carrier must pay interest at least every quarter, at no less than the average yield on 91-day Treasury bills, and must return the fund within 45 days after the lease ends (49 CFR 376.12(k)).
Can a carrier take cargo claims out of my pay?+
Only if the lease states the conditions for a deduction. The carrier must also give you a written explanation and itemization of any deduction for cargo or property damage before it makes the deduction (49 CFR 376.12(j)(3)).
Who pays an overweight fine on a sealed trailer?+
The carrier takes the risk and cost of overweight and oversize fines when a trailer is pre-loaded or sealed, the load is containerized, or the trailer or load is otherwise outside your control, and it must reimburse you if you paid. The exception is when the violation results from your own acts or omissions (49 CFR 376.12(e)).
Does leasing on make me an employee?+
The leasing rules do not say. They state that the carrier's exclusive control of the equipment does not affect whether you or your driver is an independent contractor or an employee (49 CFR 376.12(c)(4)). Employment status is decided under tax and labor law, so ask your accountant or a lawyer.
Does the carrier have to show me the freight bill?+
If you are paid a percentage of gross revenue, yes. The lease must say the carrier will give you a copy of the rated freight bill, or similar documentation for a contract carrier, before or at settlement. The lease must also let you examine the carrier's tariff or the documents used to compute rates. The carrier may delete the shipper and consignee names (49 CFR 376.12(g)).
More federal trucking rules
- Hours of Service Rules for Truck Drivers
- ELD Mandate: Who Needs an ELD
- DOT Roadside Inspection Levels Explained
- DOT Drug and Alcohol Testing Rules
- Driver Qualification File Requirements
- DVIR and Vehicle Maintenance Rules
- New Entrant Safety Audit Requirements
- Hours of Service Exceptions and Exemptions
- Motor Carrier Insurance Requirements
- CDL Classes, Endorsements and ELDT Training
- DOT Physical and Medical Card Requirements
- Drug and Alcohol Clearinghouse Requirements
- Cargo Securement Rules for Trucks
- Hazmat Basics for Truck Drivers and Carriers
- USDOT Number and Biennial Update Requirements
- Safety Ratings, Compliance Reviews and DataQs
- Federal Truck Size and Weight Limits
- California Clean Truck Check (HD I/M)
- Form 2290 Heavy Highway Vehicle Use Tax
- Truck Driver Phone, Texting and Seat Belt Rules
- Railroad Crossing Rules for Truck Drivers
- Truck Emergency Equipment and Warning Triangle Rules
- Truck Windshield, Dash Cam and Mirror Rules
- CDL Disqualification: Major and Serious Offenses
- Truck Tire Rules: Tread Depth, Retreads and Pressure
- Trailer Reflective Tape (Conspicuity) Rules
- Truck Brake Rules: Pushrod Stroke, Lining Thickness and ABS
- Driver Conduct Rules: Alcohol, Drugs, Fatigue, Passengers and Pre-Trip Checks
- English Language Proficiency for Truck Drivers: The 391.11(b)(2) Rule
- Weigh Station Rules: Who Must Stop and What Happens If You Skip
- Truck Lighting Rules: Required Lamps and Reflectors (49 CFR 393)
- Driver Road Test Rules: The Company Road Test and Certificate (49 CFR 391.31)
Related terms and pages
Sources
Want a dispatcher to handle this for you?
Grow Trucking finds loads, negotiates rates and does the paperwork for owner-operators and small fleets. Tell us about your truck and we will show you how we can help.
Also: About Grow Trucking · Refer a carrier · Trucking blog
This is a plain-language summary for reference, not legal advice. Check the official rule text before you rely on any detail. Ask a compliance professional about your own operation.