Employee of Three Years switched to 1099 employee?

[marykate45]

What is the name of your state? New Jersey

I have been a employee of a company for over three years. About seven months back, they decided that they were going to change our status to 1099 employees.

Actually, what they did was spilt my salary in half. <Background>They have two legal company names which when I was hired ,operated as one company and I did work for both and was a employee of both. I received one paycheck.

Than the switch, They spilt up the salary. They kept me a employee of One company (very small amount) and put the majority of my pay on the second company and the 1099 status. However, job duties did not change etc.We were told that we would get changed back to employee status in Dec. Well, it is now Feb and we were told that they were not going to switch us back.

Any advice? Is this legal? I know that I am gonna have to pay alot of taxes this year and do not want the same thing to happen next year.

Thanks.

 

[abezon]

If you believe you are still an employee, you can file a form ss-8 requesting the IRS to determine your status. If the IRS determines you are an employee, it will make the company pay its half of the employment taxes and probably your half as well. As an alternative, you can report your income on form 4137 by crossing out "tips" on the form title & writing in "wages". This will flag things for the IRS.

The conservative route is to pay all the taxes & then file form SS-8.

For more info, research the difference between an employee and independent contractor on the IRS web site. There's a 20-factor test the courts & IRS use to determine your status.