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Tip for newbies
Do yourself a favor, if a prospective company pays their drivers by 1099, RUN as fast as you can. Don't fall for the BS reasons they give telling you how much better off you are. The only one who makes out on this deal is the employer. As a matter of fact, the IRS would consider you an employee in this case, so actually, the owner is breaking the law by paying you as a contractor.
Most that offer this are fly by night multi truck owners that can't afford or don't want to pay by W2. With the 1099 you the driver will be responsible for all the employers part of withholding taxes due each year, especially Social Security. They may tell you how great a deal it is, but come tax time you will owe a lot of money. |
Re: Tip for newbies
Originally Posted by Part Time Dweller
Do yourself a favor, if a prospective company pays their drivers by 1099, RUN as fast as you can. Don't fall for the BS reasons they give telling you how much better off you are. The only one who makes out on this deal is the employer. As a matter of fact, the IRS would consider you an employee in this case, so actually, the owner is breaking the law by paying you as a contractor.
Most that offer this are fly by night multi truck owners that can't afford or don't want to pay by W2. With the 1099 you the driver will be responsible for all the employers part of withholding taxes due each year, especially Social Security. They may tell you how great a deal it is, but come tax time you will owe a lot of money. Not a good way to go for the driver. |
I would call the State Workforce Commission AND the F.I.R.S. ( btw, the "F" does not stand for "Federal"!! ) on anyone who offered me such a deal. The laws which govern an employer's ability to employ someone as a contractor are very clearly defined. The penalties for employing someone illegally as an I/C get pretty steep in a hurry.
As an employer, I have a real ax to grind on this one. I try to pay my people well, and provide them with good benefits. In today's economic climate, that has become much tougher to do; I'll be dammed if I should have to compete in a market where other companies employ illegal aliens, of abuse The I/C statutes. :twisted: |
If you drive a truck there are provisions provided by the IRS where the employer can legally pay the driver without taking out taxes and issue a 1099. If the driver is under forced dispatch, then he cannot be considered an independent contractor and must be paid and issued a w2. If the driver can make his own decisions as to where he runs and whether he takes a load or not, he can be considered a independent contractor. If paying by 1099 the employer should have the driver sign a contract clearly defining the relationship and make sure the driver clearly understands that he is responsible for all taxes.
Frankly, this is a pet peeve of mine. I think everyone should have to sit down and write a check to the IRS with every paycheck. It should not be up to the employer to be a collection agency for the government. I feel confident that if everyone had to physically write the check we would have a revolt in this country. You don't miss what you don't receive. :x |
Originally Posted by GMAN
Frankly, this is a pet peeve of mine. I think everyone should have to sit down and write a check to the IRS with every paycheck. It should not be up to the employer to be a collection agency for the government. I feel confident that if everyone had to physically write the check we would have a revolt in this country. You don't miss what you don't receive. :x
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