Illegal Labor, 1099's & IRS

Discussion in 'Lawn Mowing' started by DFW Area Landscaper, Jan 8, 2004.

  1. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    I saw the NBC Nightly News last night. Bush is pushing for a new green card. From what I understand, this green card would be easily available to all illegal immigrants. It would be valid for three years. I've looked into it a little bit this winter, and as it is now, I think it's basically impossible to get a green card right now. (I may be way off here, but I certainly wouldn't be able to figure out how to get one if I needed one.)

    One thing I noticed on the telecast was that they kept showing illegal mexican laborers doing landscape work.

    Just about every LCO crew member here in the DFW area is hispanic. I would guess that most are illegals. I see a lot of LCO's driving around the labor camps in the mornings and evenings. I've used illegal help from the labor camps myself. But I haven't had the need to get help on a full time basis...yet. That should change this summer, though.

    As for hiring born and bred american citizens, I really have no interest in that at all (and I know I'm not alone in this thought).

    So my question is this: The illegal help I've used can barely speak english. They don't have picture ID's, so they can't cash a check. And I've asked one of my more regular helpers, through a translater, if he had any kind of SS#. He doesn't. (If they're illegal, isn't their lack of a SS# the very thing that makes them illegal?)

    So how do you go about hiring illegal laborers on a long term basis? If you pay any single helper more than $600 per year, you can't deduct the expense without a 1099, which would require a social security number.

    I've considered just telling my regular helper that I have no way of knowing if a SS# is real or not. Nor do I really care. My accountant tells me that I just need those nine digits on the form. Won't matter that much if it's not real. My defense is that I have no way of knowing if it's real or not.

    FWIW, I believe my help should be paid via W2, but my accountant has lead me to believe that I can pay via 1099 for several years before I need to move to W2. I also know several landscapers who have paid employees via 1099 for years on end and have never had a problem with the IRS or the state unemployment office.

    My gut feeling is that the IRS and state unemployment people know without a doubt that small business contractors, like LCO's, are using illegal help. But they also know that if they start cracking down on the 1099 labor, on a wide scale level, that just about every bit of construction, roofing, landscaping, etc. would probably come to a screaching halt. I think our economy relies on the illegal laborer. No one wants to talk much about it because if we do talk about it, we soon realize that americans are just absolutely spoiled rotten and too proud (and fat) to actually do physical work. Generally speaking. Again, if the government were really concerned about ridding our country of illegal labor, wouldn't it be pretty simple to start sending a patty wagon by the labor camps every morning? Hell, on the news last night, a city in California actually had a shade tent set up for the laborers at the labor camp.

    Later,
    DFW Area Landscaper
     
  2. Fantasy Lawns

    Fantasy Lawns LawnSite Bronze Member
    Posts: 1,913

    Not to be rude ..... but this is like asking how to shoot one's self in the head

    Are you reading what your asking ... the term "illegal" should be enough to answer

    My advice is to only hire those whom can complete a legal I-9

    N I'd lose that CPA as soon as possible
     
  3. WESLEY BROWN

    WESLEY BROWN LawnSite Member
    Posts: 64

    The cool thing is that they have to be hired which elimenates the fact that they can run there own LCO.
     
  4. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    ++++The cool thing is that they have to be hired which elimenates the fact that they can run there own LCO.++++

    Huh? Not sure I follow?

    Thanks,
    DFW Area Landscaper
     
  5. LawnPerfect

    LawnPerfect LawnSite Senior Member
    Posts: 318

    Just find a good AMERICAN to work for you. Problem solved.
     
  6. 44toy

    44toy LawnSite Member
    Posts: 90

    You guys should have fun picking this one apart. I cant wait for the answer.
     
  7. WESLEY BROWN

    WESLEY BROWN LawnSite Member
    Posts: 64

    Bush said if they get the green card then they have to be hired by somone and can only have that job three years and then they get deported.
     
  8. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    ++++Just find a good AMERICAN to work for you. Problem solved++++

    If they're willing to tolerate the heat and do the work I require for the money I can pay, that ought to be a red flag in and of itself. I mean seriously, if you were born in this country and are now an adult and you are willing to work for $8 to $9 per hour in 100 degree heat day after day after day doing 'grunt' work, there's a good chance you've made some poor decisions in life.

    If a domestic helper does turn out to be a good employee, they'll probably turn out to be serious competition before too long. As for illegals becoming my competition, from what I've seen, my customers want to do business with people with whom they can effectively communicate. I've talked to some of the other hispanic LCO operators in my area and honestly, they are competing with an arm tied behind their back. Their accents are so heavy, I can barely understand them.

    Another feel I have for the illegals, right or wrong, is that they aren't a very letigious people. I've heard this from others, and it may be true.

    I'm not the only LCO who feels this way about domestic employees:

    http://www.lawnsite.com/showthread.php?threadid=57756&highlight=illegal

    Plenty of LCO's on this thread use 'suspected' illegal labor and have no regrets.

    I just want to know how to pay them and stay out of trouble with the government. I'm beginning to suspect the answer is, just don't ask any questions about their SS#. But that doesn't solve the problem of them cashing their paycheck.

    My hunch is that the government simply doesn't care. I can't prove it. But that's what I think. In fact, I think the reason Bush is pushing for easy to obtain green cards for everyone is because they want to start making contractors, like us, with hold federal income taxes on all illegal labor. As it is now, the government isn't getting their cut on all the bogus 1099 labor in the country, which may well be in the BILLIONS of dollars.

    As for the government coming after contractors who pay via 1099 on invalid SS#'s, I haven't heard any horror stories at all. If anyone has any horror stories, please post. I honestly don't think the government wants the cheap, illegal labor to go away.

    Later,
    DFW Area Landscaper
     
  9. Gene $immons

    Gene $immons LawnSite Bronze Member
    Posts: 1,028

    This new law will be great for our industry , if congress will pass it.

    I will be watching this closely.
     
  10. rman

    rman LawnSite Member
    Posts: 2

    im sorry but ill never hire illegal help , i cant stand them michael
     

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