1099 for 10. an hour

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ramsy

NoFixNoPay Electric
Location
LA basin, CA
Occupation
Service Electrician 2020 NEC
How about $10. an hour.

I'm trying to transition from union JW to contractor. Just finished a commercial garage under handyman license, $500 limit. After 50 hours I thought this wasn't right. The property owner kept promising me lots of work with other properties, got me for 2 more projects without pay, then complained angrily that I better finish faster, since the tenants were already moving in.

Owner refused to authorize me to PU permits, or request inspection, but agreed to let a C-10 check my work. Owner cried over C-10 charging $160 for 2 hours, and hit up new tenants for cost of new electrical panels, T-8 fluorescents and several other items.

These commercial garages were gutted & wrecked. Prior evictions ripped out all the conduit, fixtures, and pluming. I called the city and found out if the inspector showed up, everything would have been red tagged, and the new tenant (friend of the family) would not have had to pay a dime.

Needless to say the property owner did not appreciate me disclosing this to the tenant, who then demanded to deduct those charges from his rent. So, the owner did not give me more work at other properties, but did disclose to me they just gave another hack $24000 because, they said, paying me little chunks under $500 per project was too time consuming and annoying to them.

I am now trying to get my experience voucher from this owner, for the CSLB, so I could test for my license next year, but this is like pulling teeth without any leverage.
 
emahler said:
this has train-wreck written all over it...
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The old oh promise them lots of work, I can't belive anyone really falls for that line.

Next time, signed contract, and hefty down payment, with prosessive payments. qet that permit filed, so it will be harder for the owner to weasel out. Yup a train weck for sure.
 
mdshunk said:
Sounds like you're skirting the law, and now it's not working out for you. Sorry, no sympathy from me.
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The race starts at the starting gate, some prefer to start, at the home sprint, then complain when the horse drops dead at the finish line.
 
I am a journeyman electrician in california. I try not to do "side jobs" but do some every once in a while. I make sure the work isn't going to be over $500. I have been offered many rather large jobs that I turned down or recomended them to the contractor I work for. I plan on getting my contractors license in the next year and then will take on some bigger jobs for weekends and nights hopefully getting to the point where I can work for my self full time.

Sounds like you may be learing a hard lesson. There are a ton of unlicensed contractors taking on big jobs in Ca. Just take a look at craigslist. Get your C-10 or don't take on jobs over $500. Another warning is if you get a 1099 you better have some good write offs and a good accountant. The taxes are way more than what you would pay working for someone else. You get selfemployment taxes training taxes ect. There is a reason why contractors with a C-10 charge $75 hr + they have to pay certian taxes on you wages not to mention any of the over head.
 
satcom said:
The race starts at the starting gate, some prefer to start, at the home sprint, then complain when the horse drops dead at the finish line.
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LMAOL, You guys hate me.

I got paid, but only just before I scheduled the utility to shut down the building. This is the wild west, and I believe a leveraged shut down and my legal invoices were the only reason I got paid.

I may know the hack they hired; a 1980's vintage GC, licensed fresh out of prison, who admittedly couldn't pass an electrical inspection to save his life. I guaranteed, if the whole place burned down, fire investigators would find the units I did were the only code compliant installs on the property.

Dirt,
Thanks for the tax warning. My dependents have make the Standard Deduction larger than Itemizing in the past, but I will check again this year with the additional svc truck write off.
 
Sounds like you may be learing a hard lesson. There are a ton of unlicensed contractors taking on big jobs in Ca. Just take a look at craigslist. Get your C-10 or don't take on jobs over $500. Another warning is if you get a 1099 you better have some good write offs and a good accountant. The taxes are way more than what you would pay working for someone else. You get selfemployment taxes training taxes ect. There is a reason why contractors with a C-10 charge $75 hr + they have to pay certian taxes on you wages not to mention any of the over head.
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tax laws were written for business owners. my taxes as a business owner are far less than when i was an employee. you as the employee are responsible for your taxes. your boss is only matching your medicare and social security. i know some contractors list their employees as subs, pay them cash, and send a 1099 at the end of the year. a lot of framing crews around here work like that. concerning 1099's, you just have to keep up w/ your receipts and mileage to and from the job. what you're trying to do is show as little net as you can so it looks like you didn't make that much. which really isn't that hard to do legally. i don't think my accountant is going to put his neck on the line just for me, so i'm pretty sure every thing we do is legit. i still don't understand how it all works, i just know not to throw ANYTHING away.
 
. i know some contractors list their employees as subs, pay them cash, and send a 1099 at the end of the year. a lot of framing crews around here work like that.
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In most cases that is a violation of the tax laws.
 
don_resqcapt19 said:
In most cases that is a violation of the tax laws.
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Yes, from what I understand if you basically tell them what time they have to be at work and where they are going, they should be on company payroll. Alot of companies however 1099 people to save themselves money and keep thier costs down, but if they get caught its gonna cost them just as much. I believe the so called "sub" should have insurance also or you cannot 1099 them, but I am not positive, my insurance company require I have an insurance certificate for anyone I sub work to regardless.
 
Kessler4130 said:
Yes, from what I understand if you basically tell them what time they have to be at work and where they are going, they should be on company payroll. Alot of companies however 1099 people to save themselves money and keep thier costs down, but if they get caught its gonna cost them just as much. I believe the so called "sub" should have insurance also or you cannot 1099 them, but I am not positive, my insurance company require I have an insurance certificate for anyone I sub work to regardless.
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yes you're both right. a GC that i know lists his employees as subs and 1099's them so he doesn't have to pay workers comp. he's probably going to end up in jail before long. he's told me all kinds of ways to break the law.
 
there are ways to move employees to sub status but it is not as simple as just paying them on a 1099.

it is best for the contractor who uses such people to insist they create a legitimate business and to pay the business instead of the individual and forget the 1099 entirely. completely above board that way. more or less.

but that adds a layer of complexity to the scheme.
 
petersonra said:
there are ways to move employees to sub status but it is not as simple as just paying them on a 1099.

it is best for the contractor who uses such people to insist they create a legitimate business and to pay the business instead of the individual and forget the 1099 entirely. completely above board that way. more or less.

but that adds a layer of complexity to the scheme.
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If they do this, doesn't it become ligitimate, and hence not a scheme?
 
huh?

huh?

ramsy, did I understand corrrectly ? You are working for $10./hr. and getting a 1099 ? If that is the case, once tax time has come you would have made more by saying "do you want fries with that".
 
In defense of Ramsy

In defense of Ramsy

Ramsy seems like a square guy who's learning how this business works. He's an unlicensed scoundrel and he knows it. We were all where he is now, on the bottom rung. Nobody was born knowing the electrical business, what Ramsy is going through is known by all of us as "paying your dues".

When each of us were starting out, we did jobs where we made $10 an hour, truth be told, some jobs we made less than $1 an hour. There's nothing worng with Ramsy, he's paying his dues.

It's a rite of passage.
 
Sub-Contracting in California

Sub-Contracting in California

The California State Contractors License Board says a Contractor can only sub-contract to another licensed contractor. He cannot sub on a 10-99 to an individual and any indiviual is an employee and has to be a licensed journeyman, an apprentice or enrolled in a licensed school affillited with the state apprentice program. The IRS has different expectations regarding employye and sub-contractor status.
 
augie47 said:
ramsy, ..You are working for $10./hr. and getting a 1099 ? ..would you have made more by saying "do you want fries with that".
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Augie, I'm way beneath fried food. My neighbor fresh out of high school makes more than me at In-&-Out burger. I can get over the overtime pay & health insurance he gets, but its the horny young women he talks about that really annoys me.

I should have Tee-shirts made, "Dirt Cheep w/svc Truck", "Kick Me or Save Me"

$10 per hour was my first project. I specified rough-in for conduit, recept-boxes & lighting for a 1300 Sq ft commercial garage, in compliance with NEC Art. 511.

I bid T&M $80 per hour, Not To Exceed $500 --including material--, but did not expect to take 50 hrs.. Tenant moved in, making scissor lift impossible. I constantly moved tenant equipment around and worked on ladders. This killed me, but the $500 project limit is the law for me, and change order increases would have voided my legal right to collect, and the owner knew this.

I could have explained the problem, and tried to write a new scope for tasks, breaking it up into multiple projects, but the owner pushed me, and promised more work. I bit the bullet and honored my original scope. Owner became more agitated as my time estimates improved. Later finish, office, & bath projects worked out to 20 and 40 per hr, but by the time my actual matched my estimated time, there were no more projects left.
 
lhansenjr said:
The California State Contractors License Board says a Contractor can only sub-contract to another licensed contractor. He cannot sub on a 10-99 to an individual
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Thought I was legal as a "handyman" in my state.

Before these projects, I was working with a C-10 under 1099, using my svc truck, for $17 per hour + mileage. That C-10 paid for my municipal business license, which recorded my State JW certificate, authorized me to pull owner permits, and registered me as a sole proprietor. I invoiced the C-10, Not To Exceed $500, including materials.

The property owner I later worked with directly also sent me a 1099 form to fill out, and my city's chief inspector, and planning engineer talked me thru some of the project issues, including ways to get the owner authorization for builder / permit. I almost had that authorization from the owner, my contract www.NoFixNoPay.info was very persuasive to that end.

My building department did not act surprised that the owner was giving me grief about picking up the permit, they were helpful to me, suggested locking doors to prevent inspector access to missing toilets in bathrooms, etc., and stayed on the phone as long as I needed them.
 
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