Kinda Funny.

[mistoffolees]

To tell you the truth, the kind of "independent contractor" you are describing is the only legit kind of independent contractor. Anyone else who is paid via 1099 rather than a W2 has an employer who is likely doing so fraudulently. They are doing it to avoid the employer share of social security and medicare taxes, unemployment taxes and workers compensation insurance.

That's not even close to being true.

For example, we hire independent contractors to do some of our engineering work. They work on their own time and work on a per-project basis. They easily meet the requirements of 1099 contractors.

Well so much for that!

The newest attempt at not paying child support by the ex and his employer...

His employer has fired him and instead hired his wife.

Now I have to prove that he is working there. The wife works a 40+ hour week in town. Please tell me this will be easy to prove

Report it to the person you've been dealing with at the Attorney General's office.

Or, you could wait until year end when they file their taxes and report it to the IRS.

 

[LdiJ]

That's not even close to being true.

For example, we hire independent contractors to do some of our engineering work. They work on their own time and work on a per-project basis. They easily meet the requirements of 1099 contractors.

Those engineers are no different than Nexie was...they are in business for themselves and cover their own expenses.

 

[mistoffolees]

Those engineers are no different than Nexie was...they are in business for themselves and cover their own expenses.

Your response stated that anyone receiving a 1099 instead of a W2 was doing so fraudulently. I was simply pointing out that this is incorrect. There are lots of legitimate 1099 contractors.

 

[LdiJ]

Your response stated that anyone receiving a 1099 instead of a W2 was doing so fraudulently. I was simply pointing out that this is incorrect. There are lots of legitimate 1099 contractors.

Here is what I said, word for word:

To tell you the truth, the kind of "independent contractor" you are describing is the only legit kind of independent contractor. Anyone else who is paid via 1099 rather than a W2 has an employer who is likely doing so fraudulently. They are doing it to avoid the employer share of social security and medicare taxes, unemployment taxes and workers compensation insurance.

Nexie described an independent contract who covered their own expenses, supplied their own materials, set their own hours, and decided how to do their work themselves. That also describes the engineers you were talking about.

In what alternate universe does that state that anyone receiving a 1099 instead of a W2 was doing so fraudulently?

 

[Proserpina]

In what alternate universe does that state that anyone receiving a 1099 instead of a W2 was doing so fraudulently?

Because you said the employer was likely doing so fraudulently - hence the employee/contractor received <whatever it was> fraudulently.

I'm not defending either yours or Misto's POV here - just explaining how what you did say may be perceived.

 

[LdiJ]

Because you said the employer was likely doing so fraudulently - hence the employee/contractor received <whatever it was> fraudulently.

I'm not defending either yours or Misto's POV here - just explaining how what you did say may be perceived.

Ok, I will try better.

Contractor= Person in business for themselves they cover their own expenses, they set their own hours, supply their own materials, pay their own expenses. and decide how to do their work using the skills they have. This person would legitimately receive a 1099.

Employee= Someone who works for someone else, does not set their own hours, does not pay their own expenses, does not supply their own materials, does not decide how to do their work etc. If this person receives a 1099 its fraud on the part of the employer. This person should receive a W2.

Its that simple. The construction industry is a prime example. There are many independent contractors out there who are legitimately contractors and even if they subcontract to someone else, they are still legitimately in business for themselves. They control their own profit.

However, many "employers" consider that as long as they require their employees to provide their own toolbox, that it makes them contractors, when it does not.

 

[mistoffolees]

Ok, I will try better.

Contractor= Person in business for themselves they cover their own expenses, they set their own hours, supply their own materials, pay their own expenses. and decide how to do their work using the skills they have. This person would legitimately receive a 1099.

Employee= Someone who works for someone else, does not set their own hours, does not pay their own expenses, does not supply their own materials, does not decide how to do their work etc. If this person receives a 1099 its fraud on the part of the employer. This person should receive a W2.

Its that simple. The construction industry is a prime example. There are many independent contractors out there who are legitimately contractors and even if they subcontract to someone else, they are still legitimately in business for themselves. They control their own profit.

However, many "employers" consider that as long as they require their employees to provide their own toolbox, that it makes them contractors, when it does not.

I agree. I know people being paid by 1099 who shouldn't be and I know people being paid by 1099 who are correctly classified. In fact, I've been paid by 1099 myself (legitimately by even the most stringent standard). I was just objecting to the flat statement that employees being paid by 1099 instead of W2 were committing fraud.

 

[LdiJ]

I agree. I know people being paid by 1099 who shouldn't be and I know people being paid by 1099 who are correctly classified. In fact, I've been paid by 1099 myself (legitimately by even the most stringent standard). I was just objecting to the flat statement that employees being paid by 1099 instead of W2 were committing fraud.

I understand and accept that. That simply isn't what I said. You may have skimmed the posts and therefore misinterpreted what I said, but that is NOT what I said.

Also, the problem is much bigger than you realize. In my practice I am able to get less than 5% of the people who are misclassified, to actually fill out the paperwork for the IRS to fix the problem for them and for future employees of that particular company. On top of that no matter how much lecturing/cajoling/flat out yelling at my business customers, I do, I cannot get many of them to classify people correctly, because they don't want to be responsible for employer social security and medicare taxes, UC taxes, workers compensation insurance etc.

Everybody is feeling the "pinch" these days and a too great of percentage of those feeling the pinch are either too scared to demand to be treated properly, or too greedy/trying to reduce expenses to care if they obey the law or not. Quite a few of them were doing it wrong even before the "pinch".

So, their employees get hurt on the job, have no medical insurance and no workers comp, and get laid off because they cannot do the work anymore...and if they sue their employer they often fail, or they get a bad reference, and have trouble getting work from anyone else if they get better.

Or you get the people who made a whopping 25k on a 1099, who were legally employees, and suddenly find themselves with a 5k tax bill at tax time, because they had no idea what it meant to be paid that way...and no means to pay it, because they barely survived the year on that 25k.

Or you get the people who see that first balance due...freak out...don't file...bury their heads in the sand and 5-10 years later find themselves owing the IRS 100k with absolutely no hope of ever being able to dig themselves back out of that hole...with their whole life levied and garnished.

It is NOT pretty...and the "employees" get hurt bad. Very rarely does it ever involve someone who is making serious money and can afford to pay their taxes, who really should have been classified as an employee. Mostly its near poverty level "employees" who are so desperate for work that they take whatever they can get and suffer the consequences later.

I think that the one that ticked me off the most was the 60 year old man working at a bread factory, on an assembly line, making 12k a year, who got a 1099...and he wouldn't fill out the paperwork that would have given him some relief, because he was too scared to lose that job.

Think about it...think outside the box of your socioeconomic background.

 

[mistoffolees]

I understand and accept that. That simply isn't what I said. You may have skimmed the posts and therefore misinterpreted what I said, but that is NOT what I said.

Actually, you did - and I'm not the only one who interpreted it that way.

In context, it read as if only real estate agents could receive a 1099 and anyone else who received a 1099 should have gotten a W2 instead. I already said that I understand that it's not what you meant, but that I wanted to make sure no one took it literally.

Now, you can admit that you mis-stated badly enough to lead at least 2 regulars to see that your statement was inaccurate or you can go on fighting about it.

 

[DDDDDD]

Ok, I will try better.

Contractor= Person in business for themselves they cover their own expenses, they set their own hours, supply their own materials, pay their own expenses. and decide how to do their work using the skills they have. This person would legitimately receive a 1099.

Employee= Someone who works for someone else, does not set their own hours, does not pay their own expenses, does not supply their own materials, does not decide how to do their work etc. If this person receives a 1099 its fraud on the part of the employer. This person should receive a W2.

Its that simple. The construction industry is a prime example. There are many independent contractors out there who are legitimately contractors and even if they subcontract to someone else, they are still legitimately in business for themselves. They control their own profit.

However, many "employers" consider that as long as they require their employees to provide their own toolbox, that it makes them contractors, when it does not.

I get it... It is a rampant problem here on Long Island. Even a popular mattress seller tried to classify employees as 1099, while those workers delivered mattresses in the company trucks, and had to punch a clock, and would be docked for lateness...

Also skilled trade contractors here that require licenses would hire employees, call them "subs" and pay them on a 1099, but these workers themselves do not have contractors insurance or the proper trade license necessary to work as an independant contractor... under the excuse "I work under so-and-so's license..."

 

[DDDDDD]

I understand and accept that. That simply isn't what I said. You may have skimmed the posts and therefore misinterpreted what I said, but that is NOT what I said.

No it isn't and I've read this entire thread and you were simply misunderstood.

Also, the problem is much bigger than you realize. In my practice I am able to get less than 5% of the people who are misclassified, to actually fill out the paperwork for the IRS to fix the problem for them and for future employees of that particular company. On top of that no matter how much lecturing/cajoling/flat out yelling at my business customers, I do, I cannot get many of them to classify people correctly, because they don't want to be responsible for employer social security and medicare taxes, UC taxes, workers compensation insurance etc.

The problem is huge, I'd love to help expose how rampant it is around here. Thing is, look at it from the employer's perspective and you understand why is such an attractive risk for them to take.

Hire someone at 20 bucks an hour, after taxes, SS, medicaid, SDI, and workers comp that person can easily cost 40 bucks an hour, while the employee sees about 14.00 an hour take home. Now you gotta compete with other businesses that are paying that 20 off the books, or paying that 20 as 1099 and 20 is all it costs... and the employee sees 20 bucks every hour, and likely will never put aside the witholding.

And employees are duped into this arrangement all the time, being told "this way, everything from the clothes on your back, your lunch, and your commuting expenses is completely tax deductable! It's all writeoffs!"

Everybody is feeling the "pinch" these days and a too great of percentage of those feeling the pinch are either too scared to demand to be treated properly, or too greedy/trying to reduce expenses to care if they obey the law or not. Quite a few of them were doing it wrong even before the "pinch".

This began in the early 90's on Long Island. Contractors are famous for doing it.

So, their employees get hurt on the job, have no medical insurance and no workers comp, and get laid off because they cannot do the work anymore...and if they sue their employer they often fail, or they get a bad reference, and have trouble getting work from anyone else if they get better.

Or you get the people who made a whopping 25k on a 1099, who were legally employees, and suddenly find themselves with a 5k tax bill at tax time, because they had no idea what it meant to be paid that way...and no means to pay it, because they barely survived the year on that 25k.

Exactly! Also... keeps the unions at bay...

Or you get the people who see that first balance due...freak out...don't file...bury their heads in the sand and 5-10 years later find themselves owing the IRS 100k with absolutely no hope of ever being able to dig themselves back out of that hole...with their whole life levied and garnished.

It is NOT pretty...and the "employees" get hurt bad. Very rarely does it ever involve someone who is making serious money and can afford to pay their taxes, who really should have been classified as an employee. Mostly its near poverty level "employees" who are so desperate for work that they take whatever they can get and suffer the consequences later.

I think that the one that ticked me off the most was the 60 year old man working at a bread factory, on an assembly line, making 12k a year, who got a 1099...and he wouldn't fill out the paperwork that would have given him some relief, because he was too scared to lose that job.

Think about it...think outside the box of your socioeconomic background.

We could really use some public service announcments...