You can't just 1099 hourly employees.

I'm assuming they are independent contractors... you don't hire day labor as employees...


I mean seriously, why would anyone that is business savvy at all hire someone that is unloading a truck as a w2 employee, Eric?

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If you have equipment or product coming in and out daily u have no choice.


What about a small construction crew. You have to show w2 employees for a conglomerate of reasons.

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If you have equipment or product coming in and out daily u have no choice.


What about a small construction crew. You have to show w2 employees for a conglomerate of reasons.

Well, your original question was like one sentence. I just assumed it was day labor. But you're right, you are dictating the time they come in to work and the tide they can leave, they'd be classified as employees...


Construction crews are complicated. Most of the time, from my experience, they are 1099'd. And it makes sense, jobs are sporadic, and they are not being paid hourly, but for completing a task. Contractors don't necessarily care what time you come and go, but that the job is done by the due date. They also don't care how the work is done, as long as it's up to code.


My friend has 2 employees, both are on the admin side. His boys that he is the general contractor for get 1099'd.

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I'm talking about the subcontractor who has 3 to five full time employees that have to be w2 show up on insurance and workmanship comp etc.

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I'm talking about the subcontractor who has 3 to five full time employees that have to be w2 show up on insurance and workmanship comp etc.

I'm not a cpa, yet... so I'm just a dude spit ballin' on a sports website, but why would you w2 your sub contractors, if you're in the construction business?


Like I said, from my experience, sub contractors, heck even the general contractors are all considered independent contractors and not employees...

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Many companies will pay people as sub-contractors and not employees to avoid payroll tax, but all that does is shift the full burden to the sub when they have to pay self-employment tax.  employees have the benefit of their employer paying half the payroll tax.

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Many companies will pay people as sub-contractors and not employees to avoid payroll tax, but all that does is shift the full burden to the sub when they have to pay self-employment tax. employees have the benefit of their employer paying half the payroll tax.

I'm aware, and its totally shady! I had a client, this poor lady... she was working for a hotel as a maid, and they were 1099'ing her.


We filed an ss8 with the irs to get a opinion on it, of course they reclassified her as an employee right away. And this hotel not some run down motel 8... corporations will do anything to hose workers... but that's another topic...


I honestly think independent contractors in the construction business are not really employees... but to be honest, it's really a discussion that needs to be had between the general and the sun contractors.


In New Mexico's construction industry, it's understood that you're gonna be 1099'd fur the job your hired to do...


Different states may have different standards...

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no, the sub has to w2 their employees

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I 1099 my guys and take out their taxes myself.


It's not that hard to do employee taxes.

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I 1099 my guys and take out their taxes myself.


It's not that hard to do employee taxes.

Exactly. I mentioned this in another post, but most small businesses are using some software to do their books, those software applications come pre loaded with tax packages as well.


It's not like running your books increases you payroll, that's just not the case.

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no, the sub has to w2 their employees

That's interesting. Just curious, is your state not a right to work state? I wonder if that may be the reason for the difference. NM is a right to work (for less) state.


Irregardless, having to deal with an employees's withholding on your payroll isn't something that makes a small businesses overhead explode. Is it annoying? Is it an extra process? Sure.


But it's not my experience to be something that is punitive that strangles small businesses...

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Lol it takes my payroll time from 10 minutes for writing checks to a half hour for deducting taxes AND writing checks.

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Lol it takes my payroll time from 10 minutes for writing checks to a half hour for deducting taxes AND writing checks.

Ha!! How can you're business survive such demands by the evil gubmint?1#1!??

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U just contradicted urself

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U just contradicted urself

 

U R 2 Lzy 2 x-plane, sew I dn't care...  LOL

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You mentioned a very clear example where the IRS determined the classification of a 1099 contractor inappropriate and reclassified the worker as an employee.


Then senator talked about giving employees a 1099. You commented how easy that made things. His concept of giving an "employee" a 1099 is a contradiction of the legal relationships of independent contractor vs. Employee. It was also a moral contradiction to praise him and condemn the hotel.


His example is how the system should work in a free market system. I'm not throwing stones. Just pointing out how one sentence can cause an accounting debate.


Appearantly we all agree that doing business the way the IRS would want you to is cumbersome and to be avoided whenever possible. When I get more time ill talk about protectionist licensing etc.

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You mentioned a very clear example where the IRS determined the classification of a 1099 contractor inappropriate and reclassified the worker as an employee.


Then senator talked about giving employees a 1099. You commented how easy that made things. His concept of giving an "employee" a 1099 is a contradiction of the legal relationships of independent contractor vs. Employee. It was also a moral contradiction to praise him and condemn the hotel.


His example is how the system should work in a free market system. I'm not throwing stones. Just pointing out how one sentence can cause an accounting debate.


Appearantly we all agree that doing business the way the IRS would want you to is cumbersome and to be avoided whenever possible. When I get more time ill talk about protectionist licensing etc.

 

By "senator" you mean, Senior Fantastico, right?

 

I think there were basically 2 different conversations going on at the same time.  I'm not sure that because I was discussing 2 different topics means anything was contradictory...

 

I'd suggest going back and re-reading the thread...  The discussion of sub contractors in the construction industry in New Mexico and the discussion of employees and the high cost of calculating and accounting for income tax withholding (or specifically the ease and relative low cost of such administrative costs) are 2 separate and non-contradictory discussions.

 

As for the IRS and the function of that institution, it's pretty much protected by the Constitution.  I believe its within Article 1, which states that the government has the right and duty to impose taxes to provide for the defense and general welfare of the country...  

 

So this concept of abolishing the IRS is just ridiculous.

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I think the confusion is stemming from someone changing the circumstances with every post.


We've gone from a person with a crew of guys, to a couple hiring a few guys to unload a truck, to small businesses, to sub contractors with full time employees. Seems like someone is trying to fit an example around his argument to me.


Anyway, just to be clear I don't have employees. I hire independent contractors periodically.

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By "senator" you mean, Senior Fantastico, right?

 

I think there were basically 2 different conversations going on at the same time.  I'm not sure that because I was discussing 2 different topics means anything was contradictory...

 

I'd suggest going back and re-reading the thread...  The discussion of sub contractors in the construction industry in New Mexico and the discussion of employees and the high cost of calculating and accounting for income tax withholding (or specifically the ease and relative low cost of such administrative costs) are 2 separate and non-contradictory discussions.

 

As for the IRS and the function of that institution, it's pretty much protected by the Constitution.  I believe its within Article 1, which states that the government has the right and duty to impose taxes to provide for the defense and general welfare of the country...  

 

So this concept of abolishing the IRS is just ridiculous.

Baloney, the IRS is the Progressives answer to the problem, certainly not the only, or even a good, one.

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“An empty vessel makes the loudest sound, so they that have the least wit are the greatest babblers.”. - Plato

I'm aware, and its totally shady! I had a client, this poor lady... she was working for a hotel as a maid, and they were 1099'ing her.


We filed an ss8 with the irs to get a opinion on it, of course they reclassified her as an employee right away. And this hotel not some run down motel 8... corporations will do anything to hose workers... but that's another topic...


I honestly think independent contractors in the construction business are not really employees... but to be honest, it's really a discussion that needs to be had between the general and the sun contractors.


In New Mexico's construction industry, it's understood that you're gonna be 1099'd fur the job your hired to do...


Different states may have different standards...

Other than my time in the Navy, I have been in some form of construction or another, so I might be able to help you understand...

 

It used to be that General Contractors did everything themselves with their own crews, but through the years it's trickled down to where they hire all sub contractors and the GC simply runs the jobs, and is actually nothing more than the admin part...The reason is simple...They do less and make more money, or keep more money because they only have one or two actual workers on job sites plus the GC himself, and the sub contractors...The GC doesn't pay the sub contractors crews, pay their liability insurance, WC or have to provide benefits for their employees...The subs bid on the job(s) and if they win, they get a percentage of the total payout of the bid at certain stages of the build...Subs do everything now, all the concrete work, electrical, plumbing, HVAC, roofers, framers, et.al are all sub contractors...

 

Now here's the part about employee vs independent contractor...An independent contractor must have his own WC, liability insurance, business licence, EIN, and pay any person working for him along with all other regulations of owning a business...If you do not have all of the requirements of a business owner, you can't be an independent contractor...An independent contractor is legally self employed which means he is a business and must have all the credentials of a business and file taxes as a self employed person...

 

An employee receives a set amount of pay per hour/week, and generally has some sort of benefit(s) drives or rides in a company or owner operator contractor's vehicle, uses company tools ( most companies furnish the big expensive tools which are generally ones that have to be plugged in while the employee must furnish his own general hand tools)

 

Years ago 1099 was so popular for contractors claiming to have hired independent contractors, but very few of them filed taxes...The IRS changed the definition of an independent contractor to include being self employed, having a business license, EIN, WC and all other insurances among other things...

 

Employers loved the old rules because they didn't have to provide benefits to independent contractors, nor worry about tax obligations for them...Not so simple to just 1099 someone anymore...

 

Oh one other thing that just hit me about independent contractors...They always work by contract, if there is no contract, you certainly are not a contractor of any kind 

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