1099- bad employer pracice

Discussion in 'Business Operations' started by Johnson LCO, May 9, 2008.

  1. Johnson LCO

    Johnson LCO LawnSite Senior Member
    Posts: 336

    When i was younger I had a job where we were 1099ed, meaning no taxes were witheld and the company had no responsibilities for us. Basically we were considered subcontractors. There are certain conditions that must be met (such as they must not have to have constant supervision). Most kids didnt realize they were getting screwed until it came time to pay taxes and they were hit with a whopping 20%.

    Basically, I see this as a cheap way to avoid paying employee taxes and I have heard some members here say they do this to their employees. The only advantage to this is the employee can write off expenses, but really they have close to zero real expenses. Am i wrong, or is there something else to this? Seems like a pretty sleazy practice to me.
  2. vaughnslawns

    vaughnslawns LawnSite Senior Member
    Posts: 324

    same here back in 93 $2000.00:cry:
  3. Richard Martin

    Richard Martin LawnSite Fanatic
    Posts: 14,700

    Sleazy and illegal.

    The basic rules are

    1: You can tell them what jobs to do but you can't tell them when or in what order.
    2: They have to use their own equipment.

    There is a 12 point checklist but those 2 items pretty much disqualifies most people from being subcontractors.
  4. Grass-Masters

    Grass-Masters LawnSite Senior Member
    Posts: 424

    the title of you post itself counterdics itself.

    1099 - Bad Employer Practices

    Employers can't 1099. Employees must have taxes with held.

    You Can Hire a Contractor and issue a 1099. As stated above, if they have there own tools and work at there leisure.

    Would be nice but not gonna work. Gotta love uncle Sam :usflag:
  5. Johnson LCO

    Johnson LCO LawnSite Senior Member
    Posts: 336

    The job I had as mentioned, I was driven to a site, worked a set amount of hours and then was taken back to the office. I know for a fact that we were not "contractors" but the kids they hire have no clue so they continue to get away with it.

    On a recent post (do I "need" a dump truck) the guy said he was legal and had part time workers that he 1099ed, it brought back memories of getting taken advantage of.
  6. Roger

    Roger LawnSite Fanatic
    Posts: 5,923

    The IRS has very specific rules regarding Independent Contractors. Richard Martin and Dream Scapes have given you the right information to get started. Another suggestion is to go to the IRS website and review the rules.

    Johnson, you said "... when you were younger..." which implies the relationship with the employer was many years ago. The rules, and enforcement of the rules, has changed over the decades. At the time of your work, perhaps enforcement was much less stringent than in recent years.
  7. PROCUT1

    PROCUT1 LawnSite Platinum Member
    from TN
    Posts: 4,909

    Theyre cracking down on this hard with all agencies. You used to be able to get away with this years ago. Not anymore.
  8. Johnson LCO

    Johnson LCO LawnSite Senior Member
    Posts: 336

    Well, by many standards I am still young. I had this job only 2-3 years ago (I worked from age 16-17) and they still operate in the same fashion. I am friends w/ the manager their and still talk to him.
  9. bohiaa

    bohiaa LawnSite Fanatic
    Posts: 5,220

    I find your post troubling..........

    Most of the time when taking a 1099 or offering it

    both parties know they are being 1099'ed it's a GREAT way to make MORE money.

    as an employee, and it's a Great way to save money as an employeer..

    If someone is crying about it later, they were just misinformed....

    I used to 1099 all the time, and boost my hourly rate up 6 to 7 an hour....

    it's really wonderfull.....
  10. mngrassguy

    mngrassguy LawnSite Silver Member
    Posts: 2,167

    I find your post troubling...

    Illegal advice is still BAD advice no matter how you spin it.

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