Protecting companies from hourly employees
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@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Danp said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
From my understanding of day laborer, you work for the day and there is no promise of work tomorrow.
That's my take on it. From my POV, it's like temp labor where there isn't a long term employment relationship.
I think that that is a soft definition - not a legal one. Just how work is perceived. If you do "day labour" but get work for two days, or a week, does it change?
nope, because you are a contractor, not an employee. 1099 that stuff.
That's not what contractor means, 1099 is not applicable to day laborers, that would violate employment law 99% of the time. 1099 is essentially never legal and when it is, it is almost always for very, very highly paid people. Day laborers are definitely the last people for whom 1099 would not be a tax dodge.
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@scottalanmiller said in Protecting companies from hourly employees:
@Danp said in Protecting companies from hourly employees:
That applies to a huge number of hourly people. You leave your shift at the hotel (this applies to where I used to work) or restaurant (also applies) and there is no promise of another shift, at least not much of the time. Sometimes they know, sometimes they don't.
I have not worked in these areas, I would defer to your experience. I have worked with truck drivers, warehouse workers, clerical workers, etc.
Clerical tend to work set office hours, rather than shifts. Warehouse tend to be union. Truck drivers are very special cases, and I have no idea how they work but I would imagine often have to wait to hear if there are runs available. The people that I see get this the most are those working places where there are many shifts, often 24x7 or 18x7 hours, loads of turnover, fluctuating work loads, etc.
An office, like a doctor's office that is open exaclty one shift tends to be predictable, you do 8-4 every day unless otherwise stated. But loads and loads of entry level work is "get your schedule before you leave for the day" and if you aren't on in the next day or two, it's very easy to have no idea when you are supposed to return and if you aren't one of the key staffers, it might be a week or two before you do, or the next day, you never know.
Yes, you're talking about grocery stores and Walmart.
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Two things...
- Contractor does not mean 1099.
- 1099 does not broadly apply to any individual, it is for corp to corp tax transfer and is basically only applicable to professional level people that need no oversight and work for multiple clients at the same time.
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How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
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@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
W2, that's the singular form for employment. An individual, in only the rarest of cases (read: it will never apply to you, me or anyone that we know) should never receive a 1099.
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DoL does recognize Day Laborers, but it appears only to highlight that there is nothing unique about them. Basically it's just a page telling Day Laborers that they are normal employees.
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@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
The one exception that I know of for 1099, is when you as a non-company need to hire another person for more than $600 to do some labor for you. In which case, you can pay them on a 1099. But in nearly all cases, that person would work for a company, not be an individual.
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@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
https://www.dol.gov/whd/FLSAEmployeeCard/calendarR5Web.pdf
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@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
W2, that's the singular form for employment. An individual, in only the rarest of cases (read: it will never apply to you, me or anyone that we know) should never receive a 1099.
LOL I receive them all the time. I have been for years.
I get them from the clients I do work for on the side. What kind of employee would you classify me as when I randomly work for them 2 hours this week, then nothing for a completely random period of time, then 5 hours.. then random, then 1 hour, etc?When I owned my own company... I got 1099s, which I think is when you said I should be getting them.. because it was one company telling another company about something.. but something that's important to taxes.
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@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
The one exception that I know of for 1099, is when you as a non-company need to hire another person for more than $600 to do some labor for you. In which case, you can pay them on a 1099. But in nearly all cases, that person would work for a company, not be an individual.
Why would you, as a person, not a company, care about giving another private person a 1099? why deal with the hassle? Can I claim a tax deduction somehow on that?
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@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
W2, that's the singular form for employment. An individual, in only the rarest of cases (read: it will never apply to you, me or anyone that we know) should never receive a 1099.
LOL I receive them all the time. I have been for years.
Tons of IT people do, it's a known scam run on IT people as IT people almost never know the law and how employment works. IT specifically is abused terribly.
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@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
The one exception that I know of for 1099, is when you as a non-company need to hire another person for more than $600 to do some labor for you. In which case, you can pay them on a 1099. But in nearly all cases, that person would work for a company, not be an individual.
Why would you, as a person, not a company, care about giving another private person a 1099? why deal with the hassle? Can I claim a tax deduction somehow on that?
Because you HAVE TO. You know, tax fraud audits suck.
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@Dashrender said in Protecting companies from hourly employees:
I get them from the clients I do work for on the side. What kind of employee would you classify me as when I randomly work for them 2 hours this week, then nothing for a completely random period of time, then 5 hours.. then random, then 1 hour, etc?
Well, if you are handling lots of clients, you should not be being paid directly it should always go to a company, that's just basic "working for lots of people" stuff. In that case, if you are confident that they in no way should be treating you as an employee, then you should form a company to handle the 1099. As a person, you can receive them, but really should not.
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@Dashrender said in Protecting companies from hourly employees:
When I owned my own company... I got 1099s, which I think is when you said I should be getting them.. because it was one company telling another company about something.. but something that's important to taxes.
Correct. If you get a 1099, ever, it means you are running a business. The question is whether you have properly set it up or are just taking 1099s and opening yourself to unlimited liability. That's not illegal in any way, just ridiculously foolish.
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@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
W2, that's the singular form for employment. An individual, in only the rarest of cases (read: it will never apply to you, me or anyone that we know) should never receive a 1099.
LOL I receive them all the time. I have been for years.
Tons of IT people do, it's a known scam run on IT people as IT people almost never know the law and how employment works. IT specifically is abused terribly.
how should this employment look then?
should I be a regular employee - with normal employee benefits where applicable? i.e. if I worked enough hours in a month they would have to give me healthcare assuming they provide it for full time employees? that they should pay the FICA taxes on my behalf? -
Remember that LLCs, S Corps, C Corps and similar are "Limited Liability" entities. Running a sole owner business or partnership is an "Unlimited Liability" business type. Never do that.
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@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
The one exception that I know of for 1099, is when you as a non-company need to hire another person for more than $600 to do some labor for you. In which case, you can pay them on a 1099. But in nearly all cases, that person would work for a company, not be an individual.
Why would you, as a person, not a company, care about giving another private person a 1099? why deal with the hassle? Can I claim a tax deduction somehow on that?
Because you HAVE TO. You know, tax fraud audits suck.
LOL this is one that's glossed over so badly it's insane. Or as you said, happens so rarely that the IRS doesn't bother looking.
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@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
I get them from the clients I do work for on the side. What kind of employee would you classify me as when I randomly work for them 2 hours this week, then nothing for a completely random period of time, then 5 hours.. then random, then 1 hour, etc?
Well, if you are handling lots of clients, you should not be being paid directly it should always go to a company, that's just basic "working for lots of people" stuff. In that case, if you are confident that they in no way should be treating you as an employee, then you should form a company to handle the 1099. As a person, you can receive them, but really should not.
Back in the day, I had a company, and correct.. they paid the company.
Since then, the company has closed, and today they pay me directly, not a company.
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@Dashrender said in Protecting companies from hourly employees:
how should this employment look then?
should I be a regular employee - with normal employee benefits where applicable? i.e. if I worked enough hours in a month they would have to give me healthcare assuming they provide it for full time employees? that they should pay the FICA taxes on my behalf?Yes, just like any other employee. Why would it be a special case?
I think this is the crux of this discussion. I believe that all of these situations work the same, there are very simple, basic employment rules and laws that work for all of these cases. And most everyone is seeing each as a special case needed special rules and forgetting how hard it will be when the cases get close to each other (when a furlough is under seven days, when day labor goes on for a week, when contracting becomes a regular thing, etc.) They seem like special cases when viewed individually, but when you look at what rules would be needed to differentiate them reliably, it becomes very convoluted. Employment law isn't that hard, the basic rules handle all of these cases really well.
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@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
@scottalanmiller said in Protecting companies from hourly employees:
@Dashrender said in Protecting companies from hourly employees:
How do you give tax info to a person who works more than $600 for your company in a year, if it's not 1099?
The one exception that I know of for 1099, is when you as a non-company need to hire another person for more than $600 to do some labor for you. In which case, you can pay them on a 1099. But in nearly all cases, that person would work for a company, not be an individual.
Why would you, as a person, not a company, care about giving another private person a 1099? why deal with the hassle? Can I claim a tax deduction somehow on that?
Because you HAVE TO. You know, tax fraud audits suck.
LOL this is one that's glossed over so badly it's insane. Or as you said, happens so rarely that the IRS doesn't bother looking.
It's hard to catch, so people often just go with the tax evasion, it's a lot of profit with very low risk, normally.
