I currently run a solo operation, but would like to get a partime helper for some cleanups. Any advice on how to get around all the tax b.s., since he will only be working a few hours a week?
I'll use a temp. agency. They take care of all the deductions. They even deliver and pick-up the workers. Look in your Yellow Pages. I pay $12.20 per man hour.
Though we would not try to go around taxes here is maybe a better way that I believe is legal... Hire him as a third-party contractor...meaning have a contract between you and him as if you were subcontracting the work..that might work.
LoneStarLawn. I ask my accountant a simular question. Could I pay help as a outside contractor using a 1099 form? He said legally no, They (the help) are still under my control and I would have to provide all the payroll deductions and workmans comp.
I was seeing it as more as subcontracting the work to him as another company...Do you need to pay for the taxes for another company that you subcontract work for? If so I didn't know that...
Here in Florida, I believe that there is a law, that reads: If you pay a person cash or under the table to work for you full or part-time, and that person is obligated by the court to make child support payments. If this person does not make those support payments during the time that they worked for you for cash or under the table, then the owner or the business can be held responsible to make those payments. Not to mention Uncle Sam, knocking on your door to sort thru your business. I do my best to keep good records, but I am no tax attorney. I'd rather play it safe. Plus, when you pay them cash, you end up paying the Tax anyway, and for go the deduction.
The IRS has some very strict rules concerning independ contractor vs. employee. In a nutshell, if the worker is on site with you, under your direction, using your tools, he is an employee, subject to all payroll liabilities. On the other hand, if you mearly give him the task of "clean up", and a set of basic instructions, and he does the work on his own, without your direction, then he may be able to be classified as a sub contractor. Suggest you paruse the IRS website for further details. In your case, a temp agency may be the way to go.
if you go with either the temp agency or the sub-contractor, be carefull how your insurance is set up. i know i am not covered for work that i sub-contract. save your own butt
Insurance....I think around here other then myself and a few others look at that as extra...because the price of some bids...there is no way they have libality. workers comp, buisness truck , etc,Its funny one place had all this mandatory for a bid and guess what I was the only one to turn one in....Taxes is another I know they are not paying...I guess I am doing something wrong playing by the books...oh well its why we will never be thought of as having real companys....to many trying to get a hold of the pie..we need some ind of licensing or some regulation....
If they make less than $600/yr.you don't have to pay taxes on them and they don't have to pay, day laborers. If you're using different people this will work, but i'd still carry the insurance
