Payroll Question Poll

Discussion in 'Business Operations' started by rgl1990, Mar 4, 2012.

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Payroll Question poll

Poll closed May 3, 2012.
  1. 10% or Less

    9 vote(s)
    40.9%
  2. 20% or Less

    4 vote(s)
    18.2%
  3. 25% or More

    6 vote(s)
    27.3%
  4. A significant 25% or more portion of my competition pays this way

    4 vote(s)
    18.2%
Multiple votes are allowed.
  1. rgl1990

    rgl1990 LawnSite Member
    Posts: 21

    Please Take a Moment To Vote Based on your experience in the landscaping industry. What percentage of Lawn Mowing Companies pay their workers as independent/ sub contractors?
    You do not need to leave a comment but please vote.
    Thanks
     
  2. PROCUT1

    PROCUT1 LawnSite Platinum Member
    from TN
    Posts: 4,909

    Years ago it was common. I did it myself years ago. The accountant even recommended it at the time.

    However.
    Regardless of what ANYONE says on here. It is NOT LEGAL in any way shape or form.

    You 1099 a BUSINESS plain and simple. If they have their own business, their own insurance, their own equipment. You can 1099 them. Thats it

    I went through hell for doing this years ago when I was under the advice of an accountant and thought it was perfectly legal.

    I spent a fortune on a new accountant, a tax attorney, and had to go back and pay employment taxes and workers comp for 4 years.

    It took me years on a payment plan to pay that off. Im talking tens of thousands of dollars.

    Now there are just too many ways to get caught.

    Everyone audits now.

    If the Irs doesnt pick it up. The state will. if they dont. Unemployment will. if they dont. Department of labor will. if they dont. workers comp will. If they dont, liability will.

    Its a very risky, very costly game that some people get away with for many years.

    The bigger you get, the more companies and agencies do physical audits.
     
  3. KeystoneLawn&Landscaping

    KeystoneLawn&Landscaping LawnSite Senior Member
    Posts: 774

    PROCUT is absolutely right. PA strengthened the laws about subs last year. The biggest lobby for such laws these days...Unions!!
     
  4. 32vld

    32vld LawnSite Gold Member
    Posts: 3,984

    I did not vote because there is no choice for just zero/0.

    Next those that want to 1099 their employees are trying to turn their employees into a bunch of illegal Mexicans. Shifting the cost of doing business onto their employees.

    Employees are good enough to make their employers wealthy then they are good enough to have their employers pay their taxes, UEI, WC, SS, etc.
     
  5. djagusch

    djagusch LawnSite Platinum Member
    from MN
    Posts: 4,226

    I don't know how a person could answer the question. I don't know others books. Your poll is asking for us to guess what other do, how is the results going to be good?

    I know of a few that pay temp help cash but its less than the $600 a year to report. Other than that they pay the correct way. How does the poll take that into account?
     
  6. Ridin' Green

    Ridin' Green LawnSite Fanatic
    Male, from Michigan
    Posts: 13,870

    Exactly my feelings.
     
  7. rgl1990

    rgl1990 LawnSite Member
    Posts: 21

    I believe the question was more along the line of have you ever spoken with another owner that may have said. They pay their workers with a 1099 or as a sub. Regardless if you saw their books or not. Just in conversation
    Posted via Mobile Device
     
  8. djagusch

    djagusch LawnSite Platinum Member
    from MN
    Posts: 4,226

    Every company I know that is worth a dam says it has employee's on the books properly.

    I also know that if they need extra help from time to time for one time gigs, etc they will pay out some cash (ex: we got hit with a hard snow storm and need extra shovelers. A employee brings a friend to "help" out the one time and the friend gets paid cash). Most limit this to a couple hundred max. While still not a good practice it happens time to time in the industry.

    I wouldn't put this in the same catogory that you have in the above poll. Much different than a guy who 1099's a employee at the end of the year to bypass the cost.

    Most who try the sub thing are just starting out, don't know better, and don't charge enough to make payroll.

    What percent I don't know. I do know if I'm talking to a new guy to the industry I point out the correct way to do it and why they should do it that way.

    I really don't see the point of the poll. Is it a reason to justify doing it incorrectly?
     
  9. Sam75

    Sam75 LawnSite Member
    Posts: 30

    Around my city just about everyone pays either by cash or 1099 if they are growing quickly. The bigger guys pay legit but pay overtime cash. Now I have nothing against Hispanics I Like them they are good hard working people but the ones I have talked to are not here legally. So how can they get a fein # and pay taxes legally? They cant and its not like there is only one illegal company owner. They actually laugh at me for paying payroll taxes, that sucks but life isnt fair. This may or may not be the correct way to do business but the truth of how things work are a lot of companies pay this way. The legal owners grow very slow but steady up two or maybe three trucks. The illegal guys grow to three trucks in about 3 years because there overhead is nothing. If you really want to find out the truth just ask other companies workers if they want a job, how they get paid and how much week. A real eye opener. By the way I have been in business for over 20 years in landscaping and have seen just about all of it. I won"t brag about my what mower I have or that I own a pickup. That bragging is for new guys starting out. Here's a better one. My fuel bill is about 12,000 a month for my fleet for 8 months out of the year.
     
  10. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Posts: 4,316

    I know of none that do. I can only speak from 23 years in this trade and over 100 employees wither working for me or under me but not one has ever spoken of that.
     

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