How to tax new employees????

Discussion in 'Business Operations' started by Services Plus LLC, Feb 11, 2007.

  1. Services Plus  LLC

    Services Plus LLC LawnSite Member
    from CT
    Posts: 22

    I'm trying to figure out when I can state that I use a person who works for me as casual labor, for IRS purposes, and when and how soon do I HAVE to start him/her as an employee, with witholding tax, state tax, put them on my gernal liability insurance, workmans comp. etc. which all adds up, BIG TIME!!, along with all the other fun taxes. I am wondering what all you other "owners" due with these summer help guys??? I would always just those non employees, a 1099 at the end of the year and consider them "subs", but that really is not proper, so I've been told. But on the other side, how can you start every guy as an employee right off the bat at your company, when the majority DONT work out and only stay with you a week or two....or you end up firing them for not showing up, drinking, fighting with other workers, etc..... whatever the excuse may be??? My question is, so what do all these other "service industry" owners do with their "summer help", such as tree service co., restuarants, asphalt companies, builders etc??? Any help would be greatly appreciated!!!!! Thanks
     
  2. Lawnworks

    Lawnworks LawnSite Fanatic
    from usa
    Posts: 5,407

    I use a payroll company. You don't pay an upfront workmans comp... they just charge 5% on what you pay them. It take all of the headache out of it.
     
  3. Services Plus  LLC

    Services Plus LLC LawnSite Member
    from CT
    Posts: 22

    Thanks for the reply, not really talking about a payroll company persay, more asking do you start ALL of your guys from DAY ONE as employees??? As I'm sure you know having an employee on your payroll is much more of an expense than paying them as a "sub" or casual labor?
     
  4. Lawnworks

    Lawnworks LawnSite Fanatic
    from usa
    Posts: 5,407

    They all go onto payroll, unless they are there less than a week. Then I just cut them a check. I have heard that if the amount is under $600 for the year then you don't have to worry about it... best thing to do is call your cpa.
     
  5. Services Plus  LLC

    Services Plus LLC LawnSite Member
    from CT
    Posts: 22

    Yes, that is what my CPA told me... 600 or under for an entire year than it's not a problem, anything OVER that, I guess I have no choice but to put everyone I hire on as an employee..... what a hassle being the boss!!! lol Thanks for your time!
     
  6. Gmgbo

    Gmgbo LawnSite Senior Member
    Posts: 382

    with one employee do you need workmens comp insurance? how much is it usually
     
  7. ed2hess

    ed2hess LawnSite Fanatic
    Posts: 13,311

    Ask your guy how it would affect things if you paid by the job!
     
  8. Duekster

    Duekster LawnSite Fanatic
    from DFW, TX
    Posts: 7,961

    There are several ways. you can use a 1099. a temp firm and run them as a temp to hire or just hire them. You
     
  9. Lawnworks of Hop.  LLC

    Lawnworks of Hop. LLC LawnSite Member
    Posts: 6

    You need Workers Comp. for each person working for you.

    Contract labor does not need to be covered by workers comp. by you. But there are specific rules determining what a contract labor is.
     
  10. Lawnworks

    Lawnworks LawnSite Fanatic
    from usa
    Posts: 5,407

    It varies from state to state... in GA if you have less than 3 people working for you... you are not required to have workmans comp.
     

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