I am working with a super small business, making 29k a year – but here's the kicker. I'm 1099. I do not choose when I work, where I work, and I am just generally given a job to do, but it has to be exactly to the request of my boss. I know I could report them to the IRS, but it'll be blantantly obvious I'm the one reporting bc there's only 2 main employees (me and my coworker). We have a few people who come in to do little jobs here and there, who also are 1099, and are also not given any freedom of choice when it comes to their job. What is a way I could address this directly with my boss/how to explain it is unfair business practices?
Any advice at all is appreciated. I am the bookkeeper so I know we have the money to afford being W2
Small Business Paying me as a 1099 NEC
byu/Training-Yam1975 intax
Posted by Training-Yam1975
9 Comments
You’re not 1099 and they are robbing you of 15% of your pay. Since you have to cover both sides of the Social Security wages. State department of labor would probably take the case, what they are doing is illegal.
Your boss likely won’t care. And it’s not their call whether you’re 1099 or W2. Your best option is to find a new job and report them to the IRS/DOL honestly, small businesses like this suck. Ask me how I know.
Tell him it’s unfair to you and you’re going to seek different opportunities. Then follow through if nothing changes.
Start looking for a new job. I find that business that operate like this often cut corners and do other non compliant things. Doesn’t seem like a good place to be in the future. You probably aren’t covered by any type of workers comp coverage and you are not going to get any unemployment from the state if they let you go. Not a great situation for $29k a year.
Look for another job. He’s not going to change and reporting him will only get you “laid off”.
As far as w-2 or 1099-NEC. It also depends on your state.
In California all workers start as employees and then the employer has to determine if they are independent contractors.
The State of CA is very aggressive about proper classification of workers.
Do you work regular daily hours, 40 hours a week or does boss just contact you as needed for stand alone projects?
What a cheat! This business reaps the benefits of 1099ing you guys by deducting your salaries from the business income.
They’re not just cheating you, they’re cheating Social Security, state unemployment insurance taxes , state and local income tax, and workers comp funds in your state.
They’ve probably been doing it for years. smh
Wouldn’t matter if you had a hundred co-workers – the process isn’t anonymous anyways.
When you file your taxes, instead of filing as a contractor (schs C & SE), you’d ask the IRS to make a formal determination (form SS-8) and meanwhile file & pay as someone who should have gotten a w2 (form 4852), only paying the employee’s share of social security & medicare (form 8919).
It used to take 2-3 years, for the determination letter; probably takes longer now.
So, basically: you have until April to find a new job, or decide to help your boss fuck you over. (which can be a valid choice, if the compensation is right; just remember *who* this practice is unfair *to*).