Register free!

The Green Industry's Resource Center



Reply
 
Thread Tools   Display Modes
  #1  
Old 02-25-2010, 06:48 PM
TeamLawnCare TeamLawnCare is offline
LawnSite Member
 
Join Date: Feb 2006
Location: Davis County, Utah
Posts: 31
Sub Contracting issues

I typically do all of my work myself, however this year I am being overloaded with aerations and will be hiring 2-3 people to run and aerating crew. They will be hired for 5 days a week 9-5 maybe 9-6 some days, for approximately 10 weeks. So can I just hire them on a contractual basis and 1099 them at the end of the year?
Reply With Quote
  #2  
Old 02-25-2010, 07:32 PM
Sweet Tater's Avatar
Sweet Tater Sweet Tater is offline
LawnSite Silver Member
 
Join Date: Aug 2007
Location: North East Mississippi
Posts: 2,123
Quote:
Originally Posted by TeamLawnCare View Post
I typically do all of my work myself, however this year I am being overloaded with aerations and will be hiring 2-3 people to run and aerating crew. They will be hired for 5 days a week 9-5 maybe 9-6 some days, for approximately 10 weeks. So can I just hire them on a contractual basis and 1099 them at the end of the year?
Thats what I do, and the CPA says its all kewl
__________________
2003 Dodge Quadcab 1500
Custom 14' Dump landscape trailer
2008 52" Exmark Lazer Z
2010 Ferris Evolution 48" cut 20 Hp
Kawasaki Line trimmer
Br600 Backpack Blower
Stihl chain saw
Stihl MM 55 Yard Boss
Misc handtools

Pictures of my trailer here

Pictures of some Landscape and structures I've done
Here
Reply With Quote
  #3  
Old 03-02-2010, 08:46 PM
utah skibum utah skibum is offline
LawnSite Member
 
Join Date: Feb 2008
Location: Brigham City Utah
Posts: 5
I see that you’re in Utah. The state is looking closer and closer at Employers that are using sub contractors; they look to see if they are a true sub or need to be an Employee.
I would talk to your CPA to see what they think of it. If the State finds a sub that should be an employee, you will have to pay all back taxes and could be find.
Reply With Quote
  #4  
Old 03-02-2010, 09:14 PM
M RASCOE&SONS's Avatar
M RASCOE&SONS M RASCOE&SONS is offline
LawnSite Bronze Member
 
Join Date: Oct 2005
Location: OLDSAYBROOK CONNECTICUT
Posts: 1,474
workers comp would be something you might look into .if your gonna have a contract with these guys and you dont have workers comp i would make sure they have a tax id and atleast have their own insurance (1 mil general,2mil agg),and photo copy their insurance and also verify that its current .always cover your ass.
Reply With Quote
  #5  
Old 03-03-2010, 03:12 AM
motorscot's Avatar
motorscot motorscot is offline
LawnSite Member
 
Join Date: Jun 2008
Location: Birmingham, Al
Posts: 133
There are several things to check off for them to be contractors or employees.

IIRC, if they have all of their own equipment, license, etc, then they are contractors, if they use your equipment, then they are employees

Ex: my friend has a body shop, his "contractors" have all of their own tools, so they qualified as "contract labor" and got 1099. But, the IRS said, "who does the paint booth, frame puller, and lift belong too?". Because the items were the shop's and not the "contractors", they were considered employees and he was kicked in the nuts for unpaid wages and taxes.

Now for your situation, you might be able to have your "contractors" sign a lease with you for the use of your equipment. Don't know if this would work or not.

Google "employee vs contractor"
__________________
Shelby Lawn Enforcement
"Bringing Lawn and Order to Grass Everywhere"

www.shelbylawnenforcement.com
_______________________________________

My stuff: black truck pulling a trailer with lawn equipment in it

Stop Lowballing!! http://www.gopherforum.com/showthread.php?t=7898
Reply With Quote
  #6  
Old 03-03-2010, 03:28 AM
RCSindiana RCSindiana is offline
LawnSite Member
 
Join Date: Feb 2010
Location: Bloomington Indiana
Posts: 74
If its your equipment and you tell them when to work and how many hours to work they would be classified an employee in Indiana. I went through this for years. They also would need liability insurance as a sub contractor. Its kind of hard to get a guy you pay 9 bucks an hour to pay a 500 dollar liability premium. One other thing, If you report to your insurance agent that you use subcontractors then be prepared for a yearly audit from the insurance company. They regularly audit for liabilty insurance on subs along with a workmans comp affadavit. Trust me, You will sleep better at night just biting the bullet and going with a workman comp policy.
Reply With Quote
  #7  
Old 03-03-2010, 11:26 AM
KeystoneLawn&Landscaping's Avatar
KeystoneLawn&Landscaping KeystoneLawn&Landscaping is offline
LawnSite Senior Member
 
Join Date: Jan 2006
Location: Erie, PA
Posts: 776
Do you have people already or will you be looking for them? If you don't have anyone yet maybe a temp service would work for you. Those services cost a little more than hiring, but they handle all the work comp, taxes, etc for those employees. I may need help this year and if I do I'm using a temp service.You give them a description of the employee your looking for. If they send you someone you don't like, then you tell them to send someone else. Thats what I like about using the temp service. Save time interviewing and easy to replace a unsatisfactory employee.
__________________
99 Silverado 4x4
2007 Silverado 2500HD 4x4
2005 Cargo King 7'x16' enclosed
Blizzard 860HD
7 1/2 ft Western Plow
Toro 7/24 snowblower
2 Toro CCR 2450 snowblowers
48" Allis Chalmers
48" Ferris WB
36" Exmark Viking
21" Toro
21" Poulan Pro
2- Echo PB755H
Echo & Ryobi trimmers
Echo PAS 265 & attachments
Stihl & Poulan chain saws
Stihl BP blower
Stihl FS-56RC-E Trimmer
Billy Goat 16hp HTR Loader
Pesticide License BU0426
A Positive Outlook
Reply With Quote
  #8  
Old 03-03-2010, 11:29 AM
RCSindiana RCSindiana is offline
LawnSite Member
 
Join Date: Feb 2010
Location: Bloomington Indiana
Posts: 74
What are the temp service fees typically in your experience?
Reply With Quote
  #9  
Old 03-03-2010, 12:51 PM
BearWise Landscapers's Avatar
BearWise Landscapers BearWise Landscapers is offline
LawnSite Senior Member
 
Join Date: Jul 2009
Location: Orlando, FL
Posts: 456
You received a bunch of good advice. I would use a temp service or purchase a workers comp policy to cover them. You can still pay them as 10-99 employees, but they wouldn't be independent contractors. Talk with a CPA or look up the laws in your state. Here are rules in Florida for independent contractors that can be excluded from workers compensation insurance.

Congrats on your business growing. Let us know what you decide to do.
Reply With Quote
  #10  
Old 03-03-2010, 05:31 PM
KeystoneLawn&Landscaping's Avatar
KeystoneLawn&Landscaping KeystoneLawn&Landscaping is offline
LawnSite Senior Member
 
Join Date: Jan 2006
Location: Erie, PA
Posts: 776
The temp agencies charge about 50% over what you are paying the employee.
__________________
99 Silverado 4x4
2007 Silverado 2500HD 4x4
2005 Cargo King 7'x16' enclosed
Blizzard 860HD
7 1/2 ft Western Plow
Toro 7/24 snowblower
2 Toro CCR 2450 snowblowers
48" Allis Chalmers
48" Ferris WB
36" Exmark Viking
21" Toro
21" Poulan Pro
2- Echo PB755H
Echo & Ryobi trimmers
Echo PAS 265 & attachments
Stihl & Poulan chain saws
Stihl BP blower
Stihl FS-56RC-E Trimmer
Billy Goat 16hp HTR Loader
Pesticide License BU0426
A Positive Outlook
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump





Powered by vBulletin® Version 3.8.6
Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
Copyright ©1998 - 2012, LawnSite.comô - Moose River Media
All times are GMT -4. The time now is 06:33 AM.

Page generated in 0.09468 seconds with 7 queries