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1099 vs Employee Rules: Are You In Compliance?

April 30, 2012 by Wayne Schulz

Are you classifying contractors properly? Do you know when it is permissible to pay someone as a subcontractor (aka 1099) versus employee?

I just received a “cheat sheet” from Corrine Nadolny of Paychex. The document gives an explanation of some rules about when your company should be adding works to the payroll – and when it might be permissible to pay them as independent 1099 subcontractors.

The main issue with these rules is that generally companies don’t withhold employment taxes on 1099 subcontractors. That makes it cheaper for a company to classify a worker as 1099 vs full employee.

Correctly classifying workers BEFORE they start work is the key. Download this free document and review some of the key items to consider when making these classifications. And as always, please refer to your tax or legal professional for final assistance with determining employment status.

Employee vs. 1099 Independent Contractor (PDF)

via:

Corrine Nadolny
Paychex Inc
714 Brook Street
Suite 120
Rocky Hill, Ct 06067
Office (860)257-0677 Ext. 25012
Fax (866)784-5725
cnadolny@paychex.com

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Filed Under: Sage 100 ERP Tagged With: 1099, employee, independent contractor

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About Wayne Schulz

Wayne Schulz is a Sage 100 Consultant located in Connecticut. He has worked with Sage 100 since 1986 and provides advanced support to companies located throughout the United States. If you are experiencing an issue with Sage 100 and would like to schedule a support session - please request assistance here or call 860-657-8544.

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