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  #1  
Old 06-19-2010, 12:08 AM
MikeKle MikeKle is offline
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Join Date: Oct 2007
Location: Northern KY
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form for new employees to sign?

I am trying to come up with a form that employees must sign before working for me, I have looked for templates, but havent found any like i need. Basically i am paying cash, under the table, and want to have something about them being responsible for their own taxes from this job, and something concerning injuries, so they cant sue me over something later. My friend that used to be in this industry had forms like this and is looking for them, but he admits they were likely deleted long ago. Anyone have a generic template I can copy with all the above info on it, or just a portion, and I can come up with the rest? Thanks for the help!
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  #2  
Old 06-19-2010, 12:23 AM
jasonki32 jasonki32 is offline
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Location: MN
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Have them sign a W-9 and file a 1099 at the end of the year. Basically they are a subcontractor. If you are doing cash under the table there is nothing you can make them sign legally, since what you are doing is illegal.
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  #3  
Old 06-19-2010, 01:28 AM
topsites topsites is offline
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Location: Richmond Virginia
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You can't pay them under the table and then expect them to pay taxes,
that would be like me selling cocaine on the street and expecting my buyers
to do something responsible with it.

That would backfire so bad, since it's all right for you to break the law.
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  #4  
Old 06-19-2010, 01:45 AM
ACA L&L's Avatar
ACA L&L ACA L&L is offline
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Location: Albuqueruqe NM
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Quote:
Originally Posted by topsites View Post
You can't pay them under the table and then expect them to pay taxes,
that would be like me selling cocaine on the street and expecting my buyers
to do something responsible with it.

That would backfire so bad, since it's all right for you to break the law.
yikes, cocaine, as an example, never thought i would see that one, but yeah thats illegal, all of it. Pay taxes, its a deduction at end of year, one 40 hour employee costs sumin like 200 buks a qtr. For 5-6 guys i pay like 1200 qtrlt. But with those guys I make a more than enuff to cover that, and i have piece of mind. Your accountant can file all the paperwork, its really not a big deal. Now if u wanna do profit sharing, they would be considered owners, pay them each 10%off all profits, become a corp. and your good, just be sure to cross your I's and dot your T's......good luck man
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  #5  
Old 06-19-2010, 04:33 AM
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Richard Martin Richard Martin is offline
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You can have them sign any form you want. It doesn't matter. If they are employees that work when you tell them to, at your direction and with your equipment then you are required to withhold taxes and comply with individual states workers comp laws. Huge companies like McDonalds and Walmart have tried every way they can think of to get around these laws and still today, they withhold taxes and pay workers comp on every single employee.

Listen to no one you know or anyone here at Lawnsite about this. But for your own good you'd better listen to the IRS becasue they are the people you'll be trying to explain your form to if they or one of your "employees" turns you in for not withholding taxes. Disgruntled employees are the number 1 way that companies get caught doing this and I've seen it happen a bunch of times.

Read this from the IRS.

http://www.irs.gov/businesses/small/...=99921,00.html
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  #6  
Old 06-19-2010, 06:29 AM
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jvanvliet jvanvliet is offline
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Location: South Florida
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You can't "legally" pay anybody under the table. Read the above and like some one said before have them sign a w9 and give them a 1099 at the end of the year.

Be aware the IRS has some strict guidelines as to what constitutes a 1099 employee. They are independent contractors. What that means is YOU can't set their hours. They come when they want, work for as long as they want, and the way they want as long as your purpose for engaging into a contract with them is met. They bring their own tools, or equipment or whatever.

I have drawn up a 1099 agreement for my labor force that outlines some of these things. For example it states that I may provide transportation to the work site (at a specific time) if they don't show up, they are responsible for their own transportation. At their option, they may use their own equipment, or they may utilize mine. I explicitly outline their responsibilities with completion deadlines (like the end of the day), for example; All hard surfaces and planting beds are to be edged; weed wacked and blown off on completion daily.

That establishes what they have to do per the contract, If they weed wack first or edge first, I can't tell them, I can set the standard for acceptable perfomance but I can't tell them how to do it (but I can show them). They are not my employees, they are INDEPENDENT CONTRACTORS.

The bigger your operation, the harder the IRS will look at your 1099 and your W9's.

GOLDEN RULE: DON'T MESS WITH THE IRS!
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  #7  
Old 06-19-2010, 07:26 AM
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Richard Martin Richard Martin is offline
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Quote:
Originally Posted by jvanvliet View Post
I have drawn up a 1099 agreement for my labor force that outlines some of these things. For example it states that I may provide transportation to the work site (at a specific time) if they don't show up, they are responsible for their own transportation. At their option, they may use their own equipment, or they may utilize mine. I explicitly outline their responsibilities with completion deadlines (like the end of the day), for example; All hard surfaces and planting beds are to be edged; weed wacked and blown off on completion daily.

That establishes what they have to do per the contract, If they weed wack first or edge first, I can't tell them, I can set the standard for acceptable perfomance but I can't tell them how to do it (but I can show them). They are not my employees, they are INDEPENDENT CONTRACTORS.
I don't know if your people are independent subcontractors the way you have it setup. As I wrote above, you can state anything you want in a contract. The IRS won't give 2 hoots about it. For them to qualify as subcontractors you basically give them a list of lawns to cut for the week (or day if you have a daily contract written up and signed by all involved parties) and tell them to cut them. If they start riding in your vehicle, using your machines and cut them in the order that you set then they are employees.

They must be independent to be subcontractors.

Look. It doesn't matter to me what most of you guys do. I gave up on that long ago. I just want to try to keep the one guy that cares out of trouble in the event the IRS does audit them.
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  #8  
Old 06-19-2010, 07:44 AM
nepatsfan nepatsfan is offline
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Location: Franklin MA
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You cant pay them as subcontractors either. For them to be independent contractors, they need their own tools and not to be told when to go places and not report to you in the morning. A friend of mine got busted for that by the dept of industrial accidents. Small guy one employee. Why dont you just go the legal route like the rest of us and pay taxes. I cant believe you would come on here and ask for ways to get out of buying insurance and pay taxes. Get workers comp and pay your guys legit, then you wont have to worry about trying to find loopholes. I am not sure what I pay for my payroll service but its under 50 bucks a week. I just tell them the hours and they take care of all the taxes and pay. They send me the checks and its done. You can even pay workers comp right with the checks. They just charge you by the 100 that you pay out. We pay a little over 4 dollars per hundred but we do landscaping and masonry which involves digging so its a little more expensive than if you are just doing maintenance.
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  #9  
Old 06-19-2010, 08:07 AM
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whosedog whosedog is offline
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Location: northern nj
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You all have to excuse Mikekle for his lapse of judgment.You see he has a heel spur,is allergic to grass(itches),has a bad back and neck,is addicted to methadone,has werewolves in his neighborhood,believes that there should be a class to teach you how to drive drunk,thinks it's ok to bang a customers wife(with the approval of his 19yr old GF),has a strange view of hell;etc.Mike we love you like a brother,you're what part of what makes LS so entertaining.
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  #10  
Old 06-19-2010, 08:35 AM
greginboise greginboise is offline
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Join Date: Feb 2010
Location: boise, id
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My corporation just went through an IRS full audit, I have 13 full time employees, we came out fine, no changes, but the auditer told me the IRS has added over 3500 new auditers this year to look into all levels of business. Better to simply do it right on the front end. I think you'll find the tax advantages to you will be huge too. Get a good accountant, someone with a little dirt under their fingernails........ no family "friends" . Make yourself accountable, because if someone gets hurt, and you try to defend yourself as not their employer, and they say you are, it could be very ugly.

greginboise
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