the chicken or the egg- 1099 vs. w2

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WHICH CAME FIRST 1099 OR W2? It has been found that millions of employers have misclassified employees as contractors.The Internal Revenue Service (IRS) understands that of the millions of misclassified workers, some may be in error. However some employers misclassify independent contractors purposefully to avoid paying state and federal taxes, and reducing costs in labor. Performs duties assigned by employer Training is provided by employer for work to be assigned Works under one employer Company payroll- employer holds federal and state taxes, Social Security and Medicare such as sick leave, holiday pay, health insurance and retirement plans Provides tools necessary to accomplish assigned tasks Set own hours Can work for multiple companies/employers Invoices personal work and hours on the job Pays taxes to IRS and state departments. Companies do not withhold pay for federal taxes on contractor’s behalf An independent contractor is exempt from Social Security and unemployment insurance (UI) taxes. These tax savings to employers can add up to a 40% savings on labor costs. W2 1099 Crack Open the Info on Misclassified Employees FAQ FAQ COMPARING THE CHICKEN & THE EGG $10.2 Million- The dollar amount of grants awarded in September 2014 to 19 states $18.2 Million- The dollar amount of wages recovered from the Department of Labor (DOL) finding over 19,000 employees misclassified by employers. COUNTING YOUR CHICKENS HATCHING A PLAN FOR MISCLASSIFICATION It is possible you may have misclassified your employees. Investigate your employee’s positions. If you find that you have misclassified an employee you may have to compensate benefits for the employment time worked without benefits. There are many ways to get the help to correct a misclassification. Federal employers in correcting misclassifications. You can also seek help from the IRS by filing Form SS-8, Determination of Worker Status for Purposes of Federal Employment and Income Tax Withholding. FAQ THE CHICKEN |OR| THE EGG 40% savings managestaff [email protected] (602) 431-8424

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1099 OR W2?

WHICH CAME FIRST 1099 OR W2?

It has been found that millions of employers have misclassified employees as contractors.The InternalRevenue Service (IRS) understands that of the millions of misclassified workers, some may be in error.However some employers misclassify independent contractors purposefully to avoid paying state andfederal taxes, and reducing costs in labor.

Performs duties assigned by employer

Training is provided by employer for work tobe assigned

Works under one employer

Company payroll- employer holds federaland state taxes, Social Security and Medicare

such as sick leave, holiday pay,health insurance and retirement plans

Provides tools necessary to accomplish assigned tasks

Set own hours

Can work for multiple companies/employers

Invoices personal work and hours on the job

Pays taxes to IRS and state departments. Companiesdo not withhold pay for federal taxes on contractor’sbehalf

An independent contractor is exempt from Social Security andunemployment insurance (UI) taxes. These tax savings to

employers can add up to a 40% savings on labor costs.

W2 1099

Crack Open the Info on Misclassi�ed Employees

FAQ

FAQ

COMPARING THE CHICKEN & THE EGG

$10.2 Million-The dollar amount of grants awarded in September 2014 to19 states

$18.2 Million- The dollar amount of wagesrecovered from the Department of Labor (DOL) �ndingover 19,000 employees misclassi�ed by employers.

COUNTING YOUR CHICKENS

HATCHING A PLAN FOR MISCLASSIFICATION

It is possible you may have misclassi�ed your employees. Investigate youremployee’s positions. If you �nd that you have misclassi�ed an employee you mayhave to compensate bene�ts for the employment time worked without bene�ts.

There are many ways to get the help to correct a misclassi�cation. Federal

employers in correcting misclassi�cations. You can also seek help from theIRS by �ling Form SS-8, Determination of Worker Status for Purposes ofFederal Employment and Income Tax Withholding.

FAQ

THE CHICKEN |OR| THE EGG

40% savings

managestaff [email protected] (602) 431-8424