1099

[K8MHZ]

I believe what is against the law is working as an unlicensed 1099 employee, not a 1099 licensed contractor. There is a huge difference.

I think you are correct.

It only specifies apprentii, journeymen and master electricians. (for 1099)

You have to be a licensed contractor to get paid (legally) directly from a customer. To be a licensed contractor you must employ at least one licensed master electrician and that person must be paid 1040 wages along with the rest on the list.

In short, it makes side jobs illegal.

 

[rodneee]

The owners accountant is now saying we need to renegotiate because he claims they cannot 1099 me for what they have paid me.

the accountant is merely advising the owners that he thinks in reality you are working for them in what should be a payroll set up as opposed to a 1099 set up.

 

[K8MHZ]

The owners accountant is now saying we need to renegotiate because he claims they cannot 1099 me for what they have paid me.

the accountant is merely advising the owners that he thinks in reality you are working for them in what should be a payroll set up as opposed to a 1099 set up.

You can't be an independent contractor if you are not both independent and a person with some form of contract.

If you use a company's tools and that company is the one that secures the work, you are not independent. You are an employee and are entitled to all the rights and protection that goes with it. Like workman's comp, payments into your SS account and unemployment.

 

[satcom]

You can't be an independent contractor if you are not both independent and a person with some form of contract.

If you use a company's tools and that company is the one that secures the work, you are not independent. You are an employee and are entitled to all the rights and protection that goes with it. Like workman's comp, payments into your SS account and unemployment.

In all my years, in this business I never heard of an electrical contractor report on a 1099, when your in business, you operate with either a fed ID number or SS number, and you always have a contract, for fixed price jobs or T&M and if you can't set a price for the job, then you may be in the wrong business.

 

[masterinbama]

The owners accountant is now saying we need to renegotiate because he claims they cannot 1099 me for what they have paid me.

the accountant is merely advising the owners that he thinks in reality you are working for them in what should be a payroll set up as opposed to a 1099 set up.

That is what i am getting. They were paying people cash, by check. And they got caught.Now they are trying to lump me in with them.

If they want to handle my payroll, and workmans compensation, and I still come out the same at the end. I will let them.
I found out different today though, their accountants thought I was among the hourly employees. They know otherwise now.

 

[satcom]

That is what i am getting. They were paying people cash, by check. And they got caught.Now they are trying to lump me in with them.

If they want to handle my payroll, and workmans compensation, and I still come out the same at the end. I will let them.
I found out different today though, their accountants thought I was among the hourly employees. They know otherwise now.

When your in business, you just hand them an invoice, and they should pay on the terms in your contract, that simple

 

[Sparky555]

This is from ehow.com.
"The IRS has an information program that requires businesses to file certain information returns. The various 1099 forms are part of this program. Businesses are required to issue 1099s for various types of payments made to independent contractors, professional service providers, and other individuals and entities. The IRS matches the 1099 information to the applicable party to ensure that the payments received are properly reported as income. It is important for small businesses to comply with the 1099 reporting requirements; the IRS imposes tough penalties for non-compliance"

I'be been asked to fill out & return a 1099. No big deal.

 

[N844AA]

I'm a sole proprietorship and a California licensed contractor and receive 1099's from customers all the time. However, it should be noted that no one is required to 1099 a corporation...

 

[satcom]

I'm a sole proprietorship and a California licensed contractor and receive 1099's from customers all the time. However, it should be noted that no one is required to 1099 a corporation...

Why would a customer send you a 1099? are they working for you? are you pqying them reportable income?

 

[ty]

Why would a customer send you a 1099? are they working for you? are you pqying them reportable income?

Because he works for them as a subcontractor. you have it backwards.

if you are an electrical contractor, and you work for a general contractor,
the GC will send you a 1099 at the end of year.

It is simple form.
It will show his Fed. ID # and your Fed. ID # or SS#, and in LINE #7 it will show the amount of money that you have been paid by that GC for the entire prior year.

 

[satcom]

Because he works for them as a subcontractor. you have it backwards.

if you are an electrical contractor, and you work for a general contractor,
the GC will send you a 1099 at the end of year.

It is simple form.
It will show his Fed. ID # and your Fed. ID # or SS#, and in LINE #7 it will show the amount of money that you have been paid by that GC for the entire prior year.

40 plus years in business and we never had a GC 1099 us we give them an invoice and they pay on the terms of the contract, but day workers that work for some GC's get a 1099

 

[N844AA]

40 plus years in business and we never had a GC 1099 us we give them an invoice and they pay on the terms of the contract, but day workers that work for some GC's get a 1099

I don't know what invoicing and contracts have to do with it. Every GC I work for 1099's the subs. It is standard practice and no big deal at year end. They come in the mail and you file them away.

 

[satcom]

I don't know what invoicing and contracts have to do with it. Every GC I work for 1099's the subs. It is standard practice and no big deal at year end. They come in the mail and you file them away.

I think it was mentioned before, in many states by law, the employees of electrical contractors must be on their payroll, no 1099's allowed. Your state may be different.

 

[ty]

I think it was mentioned before, in many states by law, the employees of electrical contractors must be on their payroll, no 1099's allowed. Your state may be different.

satcom, i think you are confusing 1099 for employees versus 1099 for companies.

I moved to DE from NJ and I have insight on how NJ works.
Here, in DE, I could not 1099 someone doing Electrical work under me, unless they had their own Electrical License and Insurance, etc. If they didn't have those required items, I would have to pay them as payroll employees. (in NJ it is not allowed, they MUST be paid as payroll employees, according to you)

But, as an Electrical Contractor, when we work for GC's, we submit a proposal, yada yada, we send them an invoice and they pay us. At tax time, they send us a 1099. it is just a form that they will file to show who they paid, how much money too.
We work in Multiple States, and they are all the same, because this is a Federal Tax Form.

In actuallity, there are numerous GC's that never send us 1099's. We still have to report their payments as income.
Any materials, or any other business deductions are accounted for.
If we didn't report their payments as income, even without a 1099, we could get into trouble with the IRS.

 

[N844AA]

1099's are given to independent contractors.

 

[zbang]

1099's are given to independent contractors.

They're also given to LLCs (see the IRS instructions and some examples). AFAICT, about the only time that you don't need to file a 1099 is when paying a real corporation.

From http://www.irs.gov/instructions/i1099msc/ar02.html

At least $600 in rents, services (including parts and materials), prizes and awards, other income payments, medical and health care payments, crop insurance proceeds, cash payments for fish (or other aquatic life) you purchase from anyone engaged in the trade or business of catching fish, or, generally, the cash paid from a notional principal contract to an individual, partnership, or estate;

[emphasis added]

Also http://www.taxalmanac.org/index.php/Discussion:Who_gets_1099-MISC

Also the 1099 instructions say that you do not HAVE to send 1099's to corps. They don't say NOT to send them.

 

[N844AA]

Good stuff there, Zbang, thanks!

 

[satcom]

I just can't believe how different the 1099 rules are viewed by some, many trades do issue 1099's for workers, I would not want to pay their their comp insurance payments, or leave my business in a constant audit position 1099 away!

 

[e57]

40 plus years in business and we never had a GC 1099 us we give them an invoice and they pay on the terms of the contract, but day workers that work for some GC's get a 1099

Then one would assume you have an EIN? or need one?

 

[Smart $]

Good stuff there, Zbang, thanks!

Here's a little more:

1099-MISC
Miscellaneous Income (Also, use this form to report the occurrence of direct sales of $5000 or more of consumer goods for resale.)
Payments for services performed for a trade or business by people not treated as its employees. Example: fees to subcontractors or directors, and golden parachute payments.
$600 or more

From: http://www.irs.gov/efile/article/0,,id=98114,00.html