1099 vs Employee: You Need to Know the Difference

By Gina Beckman, 10 til 2 Marketing Director

Do you know the difference between an independent contractor versus an employee? The distinction is relatively black and white.

Recently, this question appeared on LinkedIn:
What’s the benefit of hiring a W2 versus hiring a 1099 consultant for the same job? I’m interested in your opinion when comparing a W2 to a 1099 hire. Thanks.

This is the answer that was given:
I can’t think of a reason to put someone on W2 instead of a 1099. If the need is for a permanent, full time position, then W2 is generally the way to go. If the work doesn’t fit this category, I can’t think of a reason to use a W2 employee.

Well, she kind of got it right.
It seems there is a trend to move more and more work to independent contractors rather than hire employees directly onto payroll. The answer above is missing a few very critical points; specifically, the legal definition of a contractor and if the job can be filled by a 1099 worker or must it be a W2 employee?

The answer here is as simple as two little words. A Duck. If it walks like a duck and quacks like a duck, it’s a duck. In other words, if the position requires the employee to be directed as to how, when, where and with what to do the job, then get quacking… he is a W2 employee. If however, the job will be done independently, then a 1099 may be the way to go.

Think of a roofer. If you call someone to fix your roof you don’t tell him what size nails to use, how to swing the hammer, which guys on his team will work and when to break for lunch. That is because they are independent (AKA 1099) contractors. Now if you have an administrative assistant who is required to be at the office at 9am, dress according to code, take lunch at noon, use Microsoft Word on an office computer and report to a supervisor, well that’s a W2 employee.

This is serious stuff.

Employee misclassification is something that the Feds aren’t messing with. From large businesses to mom-and-pop shops, the fines are everywhere and they’re not cheap. Take a look:

  • After five years of litigation, the Orange County Register in California agreed to pay $22 million to settle a suit involving the misclassification of workers as independent contractors.
  • The Department of Labor ordered three construction companies to pay $491,100 in back wages and damages to 99 employees who were misclassified as independent contractors, in addition to another $108,900 in civil fines.
  • A prominent shipping company settled a series of class action lawsuits alleging worker misclassification to the tune of $27 million. Previously, the IRS had already ordered the company to pay $319 million in back taxes and penalties.

Estimates are that 20% of businesses misclassify workers; so make sure your business isn’t included in this nasty statistic. Click here to read our Top 10 Signs You Are Being Misclassified as a 1099 Contractor  or  here to read Independent Contractor (Self-Employed) or Employee? on the IRS website.

And don’t forget that to be safe on the 1099 issue, you can always use a 10 til 2 employee.

Note: We are not employment attorneys; if you have concerns regarding your employment status, we strongly suggest you speak to one or contact the Department of Labor in your state.

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362 Responses to “1099 vs Employee: You Need to Know the Difference”

  1. John Flurkey says:

    Most recently I have been working as a temporary employee and often called a contractor but always as a W2 employee. But the day before I am to start I discover that I am being employed as 1099. The comment, “Now if you have an administrative assistant who is required to be at the office at 9am, dress according to code, take lunch at noon, use Microsoft Word on an office computer and report to a supervisor, that’s a W2 employee.” would suggest that I am being misclassified for whatever reason by this consulting firm since my situation is very similar.

    This could be a deal breaker since I have no desire to be an independent contractor and would even take less money if that why. I am not happy with the start time and have no experience with this type of situation but with this latest development I may not start tomorrow since it seems like I was duped.

    • 10 til 2 says:


      You should definitely look into this, but please don’t assume that you are being “duped.” There may be a simple and honest explanation as to why they are classifying you as a 1099. Even if they are doing it in error (and we are not implying that they are), it may just be because of a lack of understanding of employment law on their part. That was actually the reason we wrote this blog post; there is a ton of misinformation and assumptions made in regard to contract employment.

      Good luck… we would love to know how this turned out for you!

      • Dora Madero says:

        I work for a small company and I am a Office Administrator . They don’t take taxes out so I have to do a 1099 , is this ok . Please let me know Thanks

        • 10 til 2 says:

          If the company is mandating as to when and how you do your job, asks you to abide by a certain dress code, tells you when to take your breaks, etc., then all signs point to you being an employee rather than a 1099 contractor. The whole point here is that designating between a 1099 contractor and an employee is not an arbitrary call; there are requirements that distinguish the two. However, as we have stated throughout this thread, we are not employment attorneys and suggest if you have further questions you speak with one or your local department of labor.

      • omar says:

        I work as a painter in Illinois. I am being payed with 1099. i also being payed less then minimum wage at $8 hr. but the thing is i have not signed the 1099 form. On top of this they owe me a check bur wont give it to me unless i sign it the form. what should i do legally ?

        • 10 til 2 Central says:

          Omar: We suggest you contact an attorney specializing in employment law; or to start you may want to contact the Department of Labor in your state. Best of luck to you.

  2. terry schoen says:

    my daughter is classified as a 1099 worker and paid 100% commission yet they control her…they tell her when to be at work…monitor her meetings with customers…report to a supervisor…submit weekly reports…tell her when she has to work…use office equipment…has an office there, etc. this is a medium company with 3 owners who are all attorneys. this seems to be a flagrant violation…true?

  3. Boss says:

    Here’s the dirt…. If you have a worker and that worker only works for you at your premises 100% of the time and uses all your equipment and you dictate how he does the work in the office he is considered a Employee and must receive a W-2.

    If that workers works for you more than occassionaly and also works for other companies and you don’t dictate when he comes and goes he is can receive a 1099. That is the condensed version.

  4. Paul says:

    My wife is a therapist, who has worked seven years at her practice. For those seven years she was salaried W-2 employee. She had to show up at a certain time, report to a supervisor, submit reports, etc. Now her boss switched her to a 1099 form with all those requirements still in tact. Is it true that this seems like a flagrant violation?

  5. cathy mac says:

    Talk to an accountant. Mine told me as 1099, I cannot deduct expenses if I am working the majority of time on their premises. Frankly, it’s easier on the employee to be W-2 because they figure all the accounting, etc. However, if you work as W-2 out of your home, make sure they pay you enough – or in addition to – your work expenses; i.e., copy paper, computer ink, etc.

  6. Jennifer says:

    I am in this very same siuation. I started a job as a graphic designer, working on various projects for them from product to print design and everything in between. In order to get this job I had to use/bring my own laptop every day while everyone else had a desktop. Came in the same time every morning as everyone else and left 8 hours later just as everyone else. Been working there for months (even got a raise) and just recently my boss called me a “Temp” (which surprised me). I started out working 3/4 days a week, but with more project demands I now work 40 hours a week. I recieved a 1099 form recently. Am I being duped?

  7. shea says:

    LAWLD i think the article is focusing on employers taking advantage of employees that don’t know any better. Where i live around austin small businesses just give 1099’s so they the employers dont have to do their own independent contractor forms. Young people don’t get taxes and don’t care to. Got better girls to do. Peace IRS and crooked Rich folk. open your wallet once and a while and the world would be better off!

  8. Kim says:

    I am interviewing tomorrow for a contract position as an Executive Assistant. I will be working from home. I have never been in a contract position. Can anyone tell me what I need to do in regards to taxes? I’m in California.

  9. Tabatha says:

    I am a CNA for a lady that is in a wheelchair I work for her part-time she always pays me with a personal check and I received a W-2 from her it says that she is not talking Federal Income tax out on me and she listed me as a Statuary Employee and she is taking Medicare and Social Security. I had no idea she wasn’t talking federal out on me and she said she considers me a 1099. What should I do ?

  10. Kim says:

    My husband is a self employed plumber and does a lot of work for 2 contracters who file a 1099 at the end of the year. We have recently hired our son to work with him as well. How do I go about making and filing a 1099 for my son at the end of the year?

  11. Matt says:

    I left my previous employer after 16 months in July of last year. I was a full time, W2 employee for the first year. Now, my old boss is telling me I need to wait to file until his accountant finishes my 1099. I have already received my 2012 W2 from this employer and have never filed a W9 as a contractor. Why would I possibly need a 1099?? Help!

    • James says:

      Kelly – my daughter is in the same boat. My accountant and tax man said this is against the law. He suggest that I contact the Texas Workforce Commission office here in our home town.

  12. Terri says:

    My daughter went to work for a very small company that was just starting out, she was laid off because the item didn’t sell well. She was paid for her hourly work, however they never took out any taxes or SS, etc. They issued a 1099 for her taxes. She then went to work as a child care provider for two children, and paid and hourly salary, however they issued her a 1099. She is not an independent contractor, she is a student, trying to work while finishing up school. Now she has to come up with at minimum $1,500 for taxes and an additional $600 for SS taxes and made less then $15,000.00 in the year. if she was issued a W2 she would only have to pay $525. What should she do now? Please help.

    • Debby says:

      Have your daughter file an SS8 directly with the IRS. They will determine whether or not she was an employee or self employed independant contractor. It’s illegal and the IRS is really cracking down on these people with stiff fines and penalties.

  13. Gerald DiPasquale says:

    I took a job as an Airboat Captain with a competitor down the road. I have been doing this for 9 years and have always been paid via W-2 and had workers comp – unemployment etc.

    When I first started I was told he needed to pay me with out any taxes taken out until he could find a payroll co. and get all required insurances. Hmm OK.

    A few months and three more employees later we’re told that NO ONE will give him a workers comp policy and we’re gong to have to be paid via 1099! Hmm well I have no choice considering I already quit my other job and the market isn’t exactly booming! OK!

    I leave and get my old job back in December. I get my 1099 in the mail Jan 2013 and go to local Tax place. I’m asked about my job as a sub-contactor, duties, work, hour, wages. “Well then you’re an employee”

    Apparently my old boss doesn’t know the law

  14. Kelly says:

    My daughter works at a hair salon. During part of 2012, she was considered an employee and taxes were withheld. Mid-year, the company decided to have all employees become self employeed. She only recieved a 1099 even though taxes were taken out during some of the calendar year. The company now wants to write her a check for the taxes that were withheld. Should I require both a W2 and a 1099? Or is it ok for the employee to write her a check for all the withholdings?

  15. Brooke says:

    Help- Background story: I started my job in Dec 2011, I thought I would be there temporarily (as did my employer to be) so I came on as a 1099. Turns out I am still working there- 15 months! I am undoubtedly a de facto W-2 worker and meet all the IRS reqs but still got a 1099 from employer. I paid estimated self-employment taxes during the year. Doing my taxes, I see I still owe additional s/e tax. But… if I had been a W-2, Id be getting a refund instead. I plan to contact the IRS to dispute my 1099 status and claim that I was a de-facto W-2. I am quitting this job anyway next month, so burning bridges isnt a big deal.

    THE QUESTION IS: what do I do until the IRS makes a determination? Complete my taxes as if I am a 1099 and hope to get a refund later on? Is it MY responsibility to have asked to be W-2d? or my boss should have know better…all advice appreciated

  16. Pat says:

    I’m moving to a new position where I will work in an office 2 days a week 8 hrs a day. I’ll be working my own hours, not those of others doing my type work. The company will provide my office supplies, my work station, etc. I won’t be forced to take a lunch hour. Have always been a W2 employee and am concerned about what financial pitfalls and tax implications this will have. I start next Monday and have to make a quick decision.

  17. Scott says:

    I have been working for a carpet cleanking company that provides me “jobs”. I am told to be at work at 7:00 A.M. then given “jobs” to complete in my own purchased company uniform. I can habe 3-4 of these a day. My job is to upsell the customer. I drive company van (which one had front bumper damage to it, for which they took $1900.00 out of my check that I was made to pay for pay for) they refused to turn it into the insurance company. I provide daily reports of all payments recieved, along with the van.
    I report to the office on their schedule, wear their uniform, drive their van, purchase their chemicals,(or I would not be covered under the $15.00 damage waiver I pay weekly)
    If I am told to do certain things their way am I a 1099 or a W2?

  18. Richard says:

    I just hired someone as a 1099 worker (she wanted to be classified this way, we don’t care if she’s 1099 or W2)who is doing accounting work for us on an ongoing weekly basis who comes and goes as she pleases, but does do her work in our offices. We will tell her what we need to have done on an ongoing basis, but its up to her to get it done. We will not be directing her as to how and when to get this work done. She also works at another company doing accounting, works some as a nanny and is also a real estate agent part time. Given all the hats she wears would it seem reasonable that this person be classified as 1099? Does the mere fact that she will be doing the work in our office make her ineligible for 1099 status?

  19. Jonathan says:


    Your new accounting hire prefers being a 1099 most likely for tax reasons. Also, this gives her the flexibility to work on mutiple contracts, and she is eligible to obtain women owned business status. Most employers frown upon moonlighting, so that is probably why she prefers that title. It is especially appropriate if she is working less than 40 hours a week for your group. It makes no difference if she does the work in your office or someplace else, unless you had her sign some type of workspace agreement.



  20. Robert says:

    I don’t want to lose my job, but I am considered a contract worker, but for the last two years have known that I should be an employee. Is there a way to report this without getting into trouble and losing my job.

  21. I worked for a company for over two years fixing their rental properties. I worked with another group of guys they hired. We used a combo of ours and their tools but always worked m-f 9-4 with and hour taken out for a lunch we never took. We were directed what to do and were supplied the materials. We were paid every Friday at their shop. I assumed they were handling their taxes and insurance they were liable for on their end. But, low and behold, we were laid off one by one and now they are saying we were sub contractors so we are outta luck on the unemployment? That’s REAL sleezey in my book! But is it legal?

  22. Brad says:

    My son received a W-2 from his employer in 2012 for his salary but received a 1099 for an end of year bonus. Is this 1099 appropriate?

  23. katc says:

    I have worked for the same company for almost 2years, I have been fired, rehired, given my own program, now that the business is growing I was told that I can not own my own logs they have to belong to him. However now multiple people have access to them. he pays for the lead generation, and i have to work 9-9 and i have to submit a schedule, when i’m not working someone else gets to “handle” my logs, am i wrong to think I am not an independant contractor since i no longer have control of my work.

  24. WIll says:

    I was a independent 1099 contractor at farmers and they put me back on W2 without my knowledge is that against the law. I signed a 1099 contract then they switch me back to a W2 worker, would love any feedback. my email is willpetaluma707@yahoo.com

  25. LF says:

    I was hired on as a w2. I can technically make my own hours, as I am the office admin and I am in charge of scheduling. However, I also have to answer to the bosses, use their equipment and be at their beck-and-call. We have a very relaxed dress-code, but a dress-code nonetheless. However, I’ve never had a lunch break time and always work straight through it. They want to switch me over to a 1099 because I make the schedule and I don’t take lunch breaks. I don’t know if I am a 1099 qualified or not. opinions?

    • 10 til 2 says:

      We are not employment attorneys, however it sounds like you are most likely a W2 employee because you are directed on how and when to do your job. Also, as a W2 employee, federal law requires that you be given an unpaid 30 minute lunch break if you are working more than five hours at a time. You may be due other breaks as well. This reply is based on our interpretation of Colorado employment laws; laws may vary from state to state. Good luck, LF.

  26. G.Ahlers says:

    I have been told I am a contract employee. However, they have deducted taxes and social security, medicare from my check. It seems a little strange but they told me I do not qualify for insurance or any other benefits. I am 55 and I think they are not filing my taxes they withdrew from my check. Can they also deny me insurance benefits that all the other employees receive?
    Thank You.

    • 10 til 2 says:

      G. Ahlers:

      Hmmm. From our perspective it doesn’t sound right. If you are a contract (1099) employee, they probably should not be taking out social security, taxes or medicare. Like we stated, we are not employment attorneys, but it sounds like it is worth you looking into further.

      There has been high-profile legal precedent on the subject of contract workers. Microsoft lost a huge lawsuit pertaining to misclassification of contract employees. While they were not deducting for ss, taxes and the like, they made contract workers do the same work as employees, but without any of the benefits. Here is a great article from Reuters on the subject: http://www.reuters.com/article/2009/04/01/businesspropicks-us-findlaw-dont-treat-c-idUSTRE53063S20090401.

      You would probably be well served to contact someone at your state’s Department of Labor to discuss this.

      Good luck G. and keep us posted!

  27. Tara b says:

    I work for a construction company for sales going door o door and I have a “boss” who tells me when I can and can’t work and what times and dress and what I can or can’t do.. I am considered a independent contractor with a 1099 is that against the law? What am I suppose to do?

  28. jo says:

    I recently rented a larger location for my clothing business which I do all the work at. I have been taking in alterations work I pin the item and write a ticket on it. I have been taking to a ladies house drop it off she charges me a flat fee and I pick it up when complete take to the store, customer picks up item and I charge my own fee for the items work.
    So far she has been a 1099. Now with the larger location she wants to set up work area in my shop with her equipment, have a key to the store, come and go as she wants, I still pin and take in the items, put them on a rack in the back she comes in and works on what & when she wants and puts on the pickup rack out front with her bill to me. I still pay her a flat fee for the work and then charge my customer my price.
    1. Is she employee or 1099
    2. If she brings in other stuff from outside customers and doesn’t pay me fee is she 1099?
    3.if there is a contract where she pays me for floor space for her equipment, comes and works at her own when she wants is she 1099?

    • 10 til 2 says:

      The bottom line is, you are paying for her services, but not telling her how, where and when to do her job… so she most definitely sounds like a 1099 or maybe even simply a vendor.

  29. Gabby says:

    I am a clinical research associate and work for a large company as a w2 employee. They are now wanting me to change to a contract (1099) employee so they don’t have to pay CA taxes on me, yet still do my job exactly the same way. Is that legal and what do I do?

    • 10 til 2 says:


      It really depends upon the parameters of your job and how much your employer oversees when and how you do it. But it doesn’t sound right to us. Although we are not attorneys (so are not in a position to give legal advice) we suggest you contact your state’s Department of Labor.

  30. Gigi says:

    I work for a small doctors office with one doctor and I am the only full time employee, classified as a full time employee and get a W2. We have another part time employee that does our billing in our office and works 15 hrs a week. My boss doesn’t want to pay taxes on her so he says she is contract labor, but she has to clock in and out, be at work at a center time, dress accordingly, etc. I think this is wrong and unethical. Am i wrong?

  31. Kris says:

    I have been working at my job as a floor cleaning specialist for 1 1/2 years now. I am a 1099. The thing is i am told what time i need to be in what jobs i am doing i drive my bosses company truck with equipment he pays gas and toll money. I get paid be the job i drive up to 7 hours of drive time each night to get these jobs done and i DO NOT get paid for drive time or mileage. I feel that something is wrong here and i feel like my boss owes me for all this driving i have done. SOMEONE PLEASE LET ME KNOW WHAT IS UP HERE!!

  32. Kris says:

    My work days also tend to be atleast 12 hour days up to 16 hours. This is the time i leave the shop till the time i arrive back to the shop. I work 5 days a week. Im putting in long days

  33. Sarah says:

    I recently took an accounting job for an auto company fixing there books. I come and go as I please, work on whatever I think needs to be done next and bring all my own equipment and office supplies. Can I claim my mileage? Also I noticed that the 2 members of the LLC are writing their checks to their wife or girlfriend. Do the wife and girlfriend need to receive a 1099? They have jobs, the members can’t get bank accounts since they owe personal back taxes. The wife and girlfriend do not work there. how do I show Distribution when the members have no checks written to them?

    • 10 til 2 says:

      Please don’t take offense, but it appears that you have more to worry about than your mileage (which by the way you should likely be able to claim as a 1099 contractor). The fact that the company might be making you complicit in tax fraud should be far more concerning.

  34. john B says:

    Hello all,

    I work for a roofing company in Maryland and I am 1099. My boss tells me what to do and makes it mandatory that I work 6 days a week and I am not allowed to take off on Saturday’s at all! They control where I go everyday and I must come to the office daily. They provide no benefits and they complain if I want to take off 1 week a year for vacation. Is this normal or should I do something about this?

    • 10 til 2 says:


      As we have mentioned several times, we are not employment attorneys, so it is best to speak with one or your state’s Department of Labor. However, at face value, it sounds like you are an employee rather than a 1099. A roofing company itself can be an independent contractor while still having its workers be employees. By classifying (or sometimes misclassifying) workers as 1099s, roofing and similar companies avoid paying massive amounts for things like Workmen’s Comp and unemployment insurance. It is definitely worth looking into. Here is a link to a great article that you should consider reading: http://www.roofingcontractor.com/articles/employee-or-independent-contractor-a-critical-distinction. Good luck and keep us posted.

  35. Lana K. says:

    My former employer misclassified me as an independent contractor. This determination was made by EDD after I applied for unemployment benefits. After it happened, The company I use to work for employer was forced to pay ALL missing payroll taxes (MediCare, Social Security and SDI) for the entire period of time my misclassification. I have never received any letters regarding this matter neither from EDD nor from IRS. Now this company is contacting me and asking to pay my portion of these taxes back to them within 90 days. They also have sent me amended W-2 forms (instead 1099 I was using to pay my taxes in the past). Am I responsible for ANY payments in this case? Thank you for helping me to resolve this problem!

    • 10 til 2 says:

      Lana. You need to contact the Department of Labor in your state. Your former employers is lucky they are not being slapped with a large fine (or maybe they are).

  36. Lana K. says:

    Thank you!

  37. Anthony texas254 says:

    Me and cousin is working for a company that from Brownsville , while that have us as 1099 they tell us when be at work , break , leave ,what to do and how to do it we get paid by the hour and my cousin was hurt on the job the other day . Cant work and needs surgery on his leg . Need help any info ……

    • 10 til 2 says:

      In our opinion, it sounds like both of you may have been misclassified and because of this, neither of you are likely covered by worker’s comp insurance. There is an easy way to help determine what type of worker someone is: If a worker is supplying the fundamental service that a company provides, they are more than likely a W2 employee. For instance, if you are a roofer working for a roofing company, you are likely a W2 and not a 1099; but if you are a plumber working for a marketing company, you are likely a 1099. As we have mentioned many times, we are not employment attorneys, so we suggest you and your cousin speak to one in your area. Good luck and keep us posted.

  38. Greg says:

    Ok my question is if I filed a 1099 a couple years back and now the IRS is saying that the employer claims I made an additional $20,000 and is asking for more money … the problem is, I really was not a 1099 independent contractor but instead an actually employee will I get in trouble if I tell the IRS that this was misclassified for not claiming it back in 2011? do they see it as I assume some responsibility seeing as I filed a tax return as 1099? The fact is I needed a job at the time and I was willing to make exceptions I normally wouldn’t but now to pay an additional 6000 dollars in taxes seems a little ridiculous. the additional income they’re claiming is not accurate to begin with but secondly I’m kind of uncomfortable being a snitch… any advice? Do i just dispute the addition income they are claiming I received and keep my mouth shut about being an employee? Or do I blow the whistle and dispute it?

    • 10 til 2 says:

      Greg… this is definitely one for an attorney who specializes in employment law. We don’t know how much you should worry about being a snitch; the entire point of this blog post is that employers need to understand that misclassification of workers can be a massive liability to their businesses… and they should know better. Good luck.

  39. Phil L says:

    My previous employer is going out of business, and hired a going out of business company to come in and do a big promotion for a few months as a last hoorah! He no longer pays us, the new company does. It’s a straight commission job, and they make us be 1099 contractors. They take out state taxes, claiming it allows us to claim unemployment when their gig is done. They originally told us when they came in that we could work as much or as little as we wanted. Then they flooded the floor (doubled the sales staff), so no one is making money. They make us come in on a schedule, have a dress code, and tell us how we are to interact with the customers. Are we 1099 contractors, or are we supposed to be employees. I am convinced they do this to not have to pay the extra taxes they would as an employer. Also, do you have any idea as to the requirements of me working for them, making less than minimum wage, vs going on unemployment and making $405 a week here in NY

    • 10 til 2 says:

      Phil… it sounds like you should be a W2, but as you know, we are not employment attorneys, so it is best to contact the Department of Labor for better evaluation of the situation.

  40. Naomi f says:

    I am looking to have someone help me out like 4 hours a week a couple times a month. Max 16 hours a month. Do I need to put them on as a w-2 employee or as a 1099 ?

  41. Rick H says:

    im a Truck driver pulling loads booked by an office worker. the company tells me when to leave and where to do all my pick ups and deliverys. the only thing i do is the route and loading n unloading along with mis paper work. they have us on 1099 where do i fit in on this. there truck there customers there phone. i pay for nothing out of my pocket

  42. Deanna says:

    I’ve recently started working with a small marketing company. They have put me down as a 1099 and consider me my own self contractor. As my first job and having no knowledge of tax returns how should i go about this? Is there any way i can file myself under a W-2 or how do i go about doing the 1099 and not having to owe incredibly ridiculously large amounts of money at the end of the year? Is the 1099 even worth the job (difficulty of keeping track)? And/or how can you write-off? The manager said that i can “write-off” as in like keeping track of all business related expenses.

    • 10 til 2 says:

      At the end of the calendar year, companies send their contract workers a 1099 form, which includes the amount the contractor has been paid for the year. This is the documentation you use on your tax returns. Many contractors put aside a portion of each check they receive into a separate account to cover taxes at the end of the year. As a contractor, you are able to write off certain expenses; check the IRS website to determine exactly which ones. Again, we are not employment attorneys; you may want to contact the Department of Labor, as they can likely best answer your questions.

  43. justin says:

    i’ve been working construction for the same boss for about five years now. when I started he told me I was a sub-contractor. I never signed an agreement. I’ve never had my own liablaty or insurance, he supplys the tools and tells me when to start and leave. I’ve been getting 1099’s every year since i’ve started… i’ve never paid in to the irs so of coarse they are coming after me for back taxes should I make them aware of the situation?

    • 10 til 2 says:

      Just because a company is a subcontractor does not mean that their employees are; either way you need to pay taxes on the money you earn. It would be wise to speak to your Department of Labor or an employment attorney regarding your specific situation.

  44. Brian says:

    My wife is being hired by my employer to do some IT work for a day or two a week while we put our 2 year old in part time daycare for socialization. The IT head is wanting to set her up as a 1099 contractor rather than a W-2 part-timer.

    What are some advantages/disadvantages to this scenerio? As a 1099, what do we need to do to minimize our tax liability and stay in compliance with the law?

    Is childcare a deductible business expense for a contractor?

  45. David Miller says:

    Great thread. Very interesting.

    I am a financial advisor for a firm in NJ. I am paid 100% on commission, but am a W-2 employee who is required to adhere to a specific schedule and dress, etc. Is it legal to have a W-2 employee be paid entirely on commission?

    • 10 til 2 says:

      As we have mentioned, we are not employment attorneys, so for a definitive answer to your question, you may want to consult with one or contact your local Department of Labor. That being said, we believe that as long as your commission averages out to at least minimum wage, employers can pay 100% commission. Not going to swear on it though. :)

  46. David Miller says:

    Ok….Thanks for the input. How about this one: Can a W-2 employee be charged a monthly fee for “rent” of his office space? I was under the impression that those rental fees were reserved for 1099 workers only….

  47. Russ says:

    I just learned the hard way there is another reason to go W-2. Limitations on garnishment for a non-tax Fed debt. I was disabled following a car accident and unable to work for over a decade. Interest, penalties, etc raised student loan debts to over $150K. I finally was able to gradually begin working, and perform paralegal service. Over 4 months, I only earned $5,400 but well on my way to becoming self sufficient again. Pay is through Fed Court system – 100% of earnings was attached as “vendor” payment versus 15% limit if deemed wages.

  48. Marshall says:

    I have worked long hours for a lawn care company for two years. I recently became a “crew” leader and received a raise. He then informed me I we were all to lose overtime. I Am classified as an independent contractor for taxes yet I wear his uniform, have had to sign his policies, a non competition agreement, I use his equipment, have set hours, and depend on him solely for money. He is now telling me I don’t earn ot because I am seasonal., yet I work 10 or 11 months a year. Someone please help

    • 10 til 2 says:

      Marshall: As we have stated, we are not attorneys; so we suggest that you get some legal advice from one or contact your Department of Labor. However, a few things seem to stand out in your comment. In our opinion, you definitely seem to be misclassified as an independent contractor, when you clearly seem to be a W2 employee (for example, independent contractors generally do not “get raises” but instead set their own rates. There are other telltales you mention that make it pretty clear that you are likely a W2 employee). In regard to overtime, we do not believe that being a seasonal worker (which you may or may not be) has anything to do with being paid overtime. Overtime is dependent on how many hours you work in a single work week, regardless of your employment throughout the year. This is all part of the Fair Labor Standards Act (FLSA). The following link will direct you to a FLSA fact sheet regarding overtime pay:http://www.dol.gov/whd/regs/compliance/whdfs23.pdf

      Good luck and please keep us posted!

  49. Steve Anderson says:

    In October of 2012 the employees were notified that the company was closing.

    However a small group of employees were retained to assist in the closing but since they did not want to pay for the payroll services, they said that we are being placed on 1099’s instead. Is this correct? They were still doing business to a degree, yet only on a smaller scale.

    • 10 til 2 says:

      It really depends on the dynamics of the work being done. Are the “1099 workers” able to work for other clients… do they set their own hours and determine their own hourly rate… things like these are the crux of what determines whether someone is an employee. So many people, including employers, are under the wrong assumption that they have a choice in how to classify workers. If you have concerns, check with an attorney specializing in employment law or contact the Department of Labor. Good luck and keep us posted!

  50. Jeanne says:

    Hi, my previous employers said that they would provide me with a 1099. For whatever reason, they decided that at the very last minute, they would give me a w-2 instead. Consequently, they had to pay all the social security that should have been taken out of my check in the previous year all at once. They are not requesting that I repay them the 1,000.00 that they did not take out of my check, but ended up paying when they decided to use a w-2. Am I responsible for paying them back this money? PLEASE HELP ME, they are being very aggressive about this.

    • 10 til 2 says:

      We assume that you mean that they are asking you for the portion you would have paid out, not cover their portion. Keep in mind that if you were to file your taxes as a 1099 you would still need to pay tax on your income. Definitely best to contact your Department of Labor or an employment attorney on this one.

  51. Mary says:

    We are RV camp hosts. We are directed on how to do the job, what hours to be open, where to do the job and with what to do it. We answer to a General Manager. We get less than minimum wage for the hours we work and are required to work those hours.

  52. Sam says:

    I have been working for a conglomerate in los angeles for past 9 years as contractor. I have put blood and sweat in their profits which is tangible. I never got a piece of profit sharing or 401 K or medical benefits. All the time there has been a middle vendor but i have been honoring work hours some times more than 9 some times 9 on premisses and been part of Management for quite some time. My questions in this case is after spending “n” number of days in the same company continuously and flagged as a contractor do i get a chance to ask them for my benefits.


    • 10 til 2 says:

      Sam, as we have mentioned, we are not employment attorneys, so we suggest that you speak with one or your local office of the Department of Labor for a more definitive answer. However, as we understand it, the amount of time you work for a business has no bearing on contract worker stats; the fact is, you can be an independent contractor indefinitely and never be entitled to corporate benefits. This is why it is important that you make sure you are not being misclassified as an independent contractor and, just as importantly, be certain that your hourly rate as an independent contractor is appropriate for the service you are providing. Independent contractors generally build their expenses (like health insurance, operational costs, etc.) into their hourly rates. Good luck and keep us posted.

  53. Ashlee says:

    I work for a company that demands us to be there at 9am-5 with set breaks, they also have us follow a dress code. We have a quota (that wasn’t even set in place when i started) i am for sure an employee, with the classification of a 10-99. If we don’t meet certain stats we can get fired (I can’t receive benefits I’m entitled to) Do i just call the local DOL and pursue it? With tax time around the corner I refuse to be subject to paying the IRS when this entire time I should have been having my taxes taken out.

  54. Steve says:

    Here’s my situation!
    For the past few years, I have been doing seasonal work for a small company, as an independent contractor. This job was another source of income!

    Before accepting this job, I always was an W2 employee, wasnt familiar with 1099 form.

    Anyways…the company classifies me as independent contractor, BUT I have to be to work at a scheduled time, a 30 min lunch break is automatically deducted if I work past 5 hours, they provided me with a company shirt and hat. I have also received an raise, in which I pursued after a few years of HARD WORK! Its also confusing that when I approached the company for the raise, I was informed that they had to get permission from the organization that they are contracted with. I am not an employee of the organization but yet they have control over what my employer pays me an hour? smh!

  55. Steve says:

    And I have even inquired about an W2 and was told the reason of the 1099 form is that the organization trying to prevent paying unemployment, due to high turnover rate. But I have knowledge that the manager of the company (relative of owner) and one other employee are on w2 status. All other employees are 1099! But i considering looking into it. Thanks!

  56. susan lange says:

    I am an employee, and the DOL is requesting that I document why I 1099’d quite a few of people that performed work for me. I pulled $30k in cash out over the year for printing and paying highschool kids to distribute flyers.
    others are “contract” processors that work from wherever they want, and they work for other companies too.
    your opinion?

  57. HJR says:

    Should I be paid more hourly when doing 1099? I am an IT Engineer Consultant doing project work but when I negotiate contracts a lot of times I am asked if i want to do 1099 or W2. Up until now I have always went with w2 because it was easier. I am really considering 1099 because I can write off a lot of my expenses. However I am not sure if I should be paid more or less or the same in comparison to a W2 contract. Please advise. Thanks

    • 10 til 2 says:

      HJR: Generally speaking, 1099 contractors determine their rates by taking into consideration the expenses incurred related to their service. Hard costs like liability insurance, office expenses, travel expenses, internet, etc. all contribute to the rate a contractor charges his or her clients. From an employer’s perspective, it costs less to pay a contractor $40 per hour than it does an employee, due to taxes and other costs inherent in running payroll; that is why many employers opt (often mistakenly) to classify workers as contractors rather than employees. This fact might work in your favor should you go the 1099 route and decide to ask for a higher rate.

      Keep in mind that employment status is usually not an arbitrary choice, but if in this case you can truly choose, then it is important to run the numbers to determine which option is most advantageous to you and/or determine if you need to increase your rate to defray some of your hard costs. Good luck and keep us posted!

      *We are not employment attorneys and our replies are strictly our own opinions. We suggest anyone with employment related questions consult an attorney or contact the Labor Department.

  58. Ralph says:

    I was previously employed by a contract company approximately 9 years. For personal reasons and in anger, I terminated employment. I realized I spoke out of anger and frustration and asked my employer to rescind my notice of determination. They refused to rescind, however, they said I was a valuable employee and offered me a position as a consultant (1099) employee. I am doing exactly the same job I was doing as a W-2 employee and all my work is directed by my supervisor. AM I really considered a 1099 employee?

  59. Karen says:

    I am being offered a sales position with a company. It is 100% commision. I have to be there from 8-5 M-F. They have a dress code. They are classifying me as a W-2 employee. This seems odd.
    Your thoughts on the benefits or not with this classification. They also do not provide ANY benefits.

    • 10 til 2 says:


      Hmmm. It sounds like there is a possibility of misclassification, so you may want to contact an employment attorney or the Department of Labor for clarity. You may also want to read “If It Quacks Like a Duck,” which lists some 1099 criteria and also has a link to the IRS website. Best of luck and keep us posted!

  60. Korey says:

    I am purchasing a semi and looking for a driver the Truck would be leased to a carrier. Would the driver be a 1099 or a w2? Please help.

  61. Janice A says:

    I am a “salaried” worker for only one company, with paid vacation, sick time and paid holidays. I work during business hours so clients can reach me, 40 hours/week, but I only ever work from home – usually never in the office. I invoice for my pay. I have to attend weekly and monthly “meetings” through Skype with the rest of the staff. I interact directly with the company’s clients, and have a title, work phone number and work email address with the company. I am assigned projects by a direct superior in addition to regular client requests, and I have deadlines on all projects. Does it sound like I could be misclassified as a 1099? Or does the fact that I work from home automatically mean I am 1099? Thanks!

    • 10 til 2 says:


      This one sort of sounds like a slam-dunk. If everything you said is accurate, we have a strong hunch that you are being misclassified as a 1099 contract worker. Working remotely has no impact on contractor status; many employees these days work from home. We strongly urge you to speak with an employment attorney (we are not lawyers) to determine your status and consider your options. Good luck and keep us posted!

  62. teri says:

    I hired some guys to do some work for me, not in my business, but help with building my house. One of the guys had his own business, hauling cars and scrap metal etc. We were tearing down our old house and he bid on tearing it down for us and we paid him on a rate of truck load haul a-ways. then when we started building the house we asked if he wanted to help us out with labor and he said that he could help out some, off and on. He had a friend who worked for him off and on and also worked for another guy (restored and resold vehicles). The project was a limited duration (basically over the summer). There were three guys who helped us pretty regularly. They all said that they had tools and at the beginning they brought their own tools, but later they asked if they could just use ours, for various reasons, but primarily because we had a few of each tool and our accessories were better suited for our tools. We have never built another house so we are not in the business of building houses. Each of the guys we hired signed documents stating that they had their own insurance and would not hold us responsible. There were no accidents and we paid them pretty much every day or on occasion, every other day, primarily because they weren’t necessarily going to work for us the next day. Each time we completed one section of the house (example we laid in the framing for the floor, we put up the log walls, installed the decking for the roof, and finished the metal roofing). We had to show the guys what we were doing and gave them basic instructions. They used their own ingenuity for getting some things done. In the end each of the 3 guys worked on different phases of the project, none of them worked on all phases and one only did a small concrete job ( a small sidewalk) because he had some concrete finishing experience. After we got a phase finished we would either ask the guys if they wanted to help on the next phase and also periodically asked if they knew anyone who might need a day, a few days or a couple weeks of work when the guys thought they could use some extra help. So one guy, who owned the hauling company, worked about 6 weeks at the beginning of the project. We tried to get him to keep a schedule, but he never did. The second guy worked about 2 or 3 months. He kept a more regular schedule, in that he basically came to work earlier in the morning (around 8 or 9 or 10) and stayed the better part of the day. He worked for a couple of other people, mostly working on cars or as added labor. It was irregular for the first guy to work more than 5 or 6 hours in a day because he had his business, he worke for his uncle and at least one other guy and he was building something on his property. Toward the middle of the project he sold his property and moved to the other side of the state. The second guy, worked for the first guy off and on and worked for another person. He never worked on Tuedsay, although every week I asked if he could. sometimes he said he would, but he never did. And he and the 3rd guy also worked for a guy who restored and resold old cars so if that guy needed them that seemed to always be their first priority. I think they had a long relationship with the car restored guy. The 3rd guy came in because we were going to lay a side walk and no one had any concrete finishing experience and the 2nd guy said that the 3rd guy wasn’t busy and might be able to help out for a few days or a couple of weeks. The 3rd guy helped with the concrete sidewalk and with a couple of decks. We hired an independent contactor to finish the last deck some other concrete work that we needed done. So these 3 guys worked for us on a temporary basis, not in our business and knowing that when the house was built we would have not work for them. They all filed documents that they had their own medical insurance. They had tools, but the regularly used our tools and we had to show them how to do some things. They were always asked if they wanted to help with the next phase. They were never hired on the basis that we would employ them if we didn’t have work they could do. Again, we don’t have a business and we have never built any other houses. Is there anyway that the IRS could construe their relationship in helping us with a one-time project when they picked and chose their own hours and jobs that they were interested in? We were never the only people these guys worked for 1 had his own business, also worked for his uncle and at least one other person, 2 worked for 1 sometimes and also worked for a guy who restored and resold cars, and 3 worked for the same guy that 2 worked for. 1 worked when he needed some cash to throw into his business, 2 worked more often but never came to work on Tuesdays, worked closer to 8 hour days, although when he was ready to leave at the end of the day he finished whether I wanted him to stay longer or not, and 3 only worked for a couple of weeks on the house and later did some automobile repairs for us because he needed some work and we needed some repairs. Since we’ve built the house, with the exception of a couple of automobile repairs by 3 and a one-day job by 2 (we hauled some wrc logs from a seller to our property and 2 helped one day (about 3 years after building the house). we didn’t furnish 1099’s to the guys. I think that 1 billed us for some of the work that he did hauling, but we just paid them cash daily for their work when they were helping with the house. They said they were keeping their own records of costs and wages.

    • 10 til 2 says:


      If you were paying the guys out of your own pocket, not from any business entity, then you are probably in the clear as they would likely be considered vendors. Think about it; if you hired a plumber to fix your sink, you wouldn’t consider him an employee… or even a contract worker for that matter. He would be considered a vendor supplying a service to you. If you were being paid as a general contractor by a client and then hiring guys to do the work, the answer might be different. As we have mentioned many times in this blog, our comments are merely our opinion on the topic. We suggest you contact an employment attorney or the Department of Labor for a definitive answer to your question. Good luck and keep us posted.

  63. Mary says:

    My son was paid by 1099 for years but required to punch a clock in/out/lunch and required to show up at a home office at a certain time and work until a certain time and was told what to do right up to where he could sit. Is this a true 1099 employee or W2? If so how or who do we report this to?

    Also, I received a 1099 from someone I didn’t work for. It was done with intent and malice. I have gone to the CPA handling this. But what are the repercussions for the person who did this?

    • 10 til 2 says:

      Mary: Your son sounds like he was an employee (unless perhaps he had multiple “clients” he did this type of work for). As to how to address both of your questions, you should consider talking to an employment attorney or the Department of Labor. Good luck!

  64. Mary says:

    Thank you for responding, No he was forced to sign a contract saying he couldn’t do that work for anyone else and couldn’t considering he was required to be there everyday on the timeclock! I have said all along it should be a W2 but they kept saying they could do that because they were a small business.

    • 10 til 2 says:

      Mary: There is so much misinformation out there regarding this subject; the size of the company has no bearing on worker status. That is why small businesses that can’t handle their own W2 payroll (which can be tricky) are best suited to engage an employment agency that puts the employee on their own payroll. Good luck and keep us posted.

  65. Jody says:

    My husband is going to start a new job in feb.This is what they told him..Best upon your performance,and our mutual desires,we would like to implement a 2 phase employment approach beginning and an Independent contractor with our team, and transitioning to a ft regular employment upon successful completion of technical and business mile stones…
    Is this right? It sounds funny to me.


    • 10 til 2 says:

      Sounds funny to us too. He might want to contact the Department of Labor. Or like Cindy mentioned, the IRS has a form that may help give clarification. Good luck to your hubby and keep us posted.

  66. Leslie says:

    I work for a small business (boutique) one day a week and I was given a 1099. Is that correct? Do I take taxes out of each paycheck to pay at the end of the year and if so how much?

    • 10 til 2 says:

      If you are truly a contract worker, it is a good idea to set some money aside out of each check for taxes. The amount depends on several factors, including your tax bracket (or the tax bracket of you and your spouse if you are married and file joint returns). For a definitive answer to your question, we suggest you contact either the IRS or the Department of Labor.

  67. Nick says:

    Hi I have left a company where I was hired as a w2 worker then I left and they sent me a 1099. They own 4 really big businesses (as in billions of dollars) so they know what they are doing but a trend I have noticed is that if anyone leaves their company they give them the short end of the stick on purpose I have texted them saying I need to get a w2 with no help. So I am asking for help on what to do

    • 10 til 2 says:

      Nick, did you fill out a w4 when you began the job? If so, it would seem apparent that they hired you as an employee and thus should be supplying you with a w2 (and they only have three days left to do it). Rather than texting them, you might consider sending a registered letter to their payroll department requesting a w2 and your reasons for the request. Will it burn a bridge? More than likely. So you need to weigh your options. Please know that we are not employment attorneys and these are just our opinions; for a definitive answer you should contact either a lawyer specializing in employment law or the Department of Labor. Good luck.

  68. Nick says:

    Yes I did fill out a w4 and thank you very much

  69. Dennis says:

    I’ll try to make this short and sweet. Last year my boss started a new company alongside the one I worked for him in so he could part ways with his partner. He asked me if I would work for him at the new company. I filled out an application and told him wrote what I wanted for an hourly rate. I also asked to keep my vacation time as well. I did not get neither but went to work for him anyway. I had a start time a lunch hour and a finish hour. 40 work week. If i was late he would get on me to be on time. As far as i knew i was an employee of his new company. He paid me with a straight check. Said it was a company check. He did not have a bookeeper at the time so he said So there was no check stub. As time went on i got more worried. I asked him when was he going to start taking deductions. At this time he said that he got a bookeeper and stubs would follow shortly. I was still treated like an employee with expectations from him as one. . He said he was going to give me a 1099. I never contracted anything with him. When i told the other emplyees about them getting a 1099 the were shocked. Everyone thought they were on the up and up as employees. Thats When the stubs started apearing i asked about the previous months and he said i was on my own. So there is a pprox 10k of income that i didnt know i was responsible for. I kept all my timesheets on my work computer that i had to turn in for that time period. I live in New Mexico. He seems confident that i have no recourse. I just got my w-2 and 1099 from the new company for the same year. Is that possible. Can he take advantage like that? Or can i inquiry at the labor dept?

    • 10 til 2 says:

      Dennis, while it speaks to how trusting you are, flares should have gone up when your employer handed you that first check. If the dynamics of your work have not changed, in our opinion, there is probably no justification he can give to his changing your contractor/employee status. And, yes, we do suggest you contact the Department of Labor for an official determination and what your options are. Good luck.

  70. Dennis says:

    Well that sounds ominous. I feel like an idiot. He knows its hard to find a job in this town. He knew I couldn’t just walk away. I just don’t know what he could have gained from all this except that he had us all fearing for our jobs because he submarined the old company. I would call him clever except I was duped so I feel embarrased by the whole thing. The last thing I want is problems with the IRS. Especially with the health insurance thing that I can’t afford. Okay well thank you for your time. I’ll make the quiry.

  71. Elijah says:

    I was a cook earning four hundred cash every two weeks for four months and I had to work six days a week.When I asked about my w2 I was told I wouldn’t get a w2 or a 1099 because they didn’t take taxes out. Is this right and where can I get help. I don’t have lots of money.

    • 10 til 2 says:

      Elijah: That is called working under the table; and your employer should know that it is illegal. Also, it sounds like if you were working much more than four hours a day, you were being paid less than minimum wage… also a big no-no if it is true. We strongly suggest you contact an employment attorney or the Department of Labor to help determine your options.

  72. Alex says:

    Thanks for the article.
    I am working for a company solar energy here in georgia and I have 7 months working vajo the 1099 because if he did not accept the way dque they acted not could work with them as they took several weeks without an income, but I meet with hours from 3pm to 3am ranging from 48 to 36 hours a week have a supervisor who tells me to do and some companions were nullified their work by late arrivals and take your break when the supervisor not allowed, how can I do to talk about this issue, as your article describes very well my situation thanks for your time

    • 10 til 2 says:

      Alex: It is hard to grasp the complexities of what you are writing about, but it does sound like your concerns are valid. We suggest you contact the Department of Labor for help or direction as to your options. Good luck.

  73. Mark says:

    I’m a web designer. I went into a interview to this company and they said it would be a 3 month to hire position so I chose this job, after 4 months I asked my boss about getting hired and he said that I should stay on contract I’ll get paid more, I told him I want security from my job and benefits. He said he would talk to upper management. After another month not hearing anything I asked him again he said that they aren’t going to hire for my position and that in a few months that I can be let go of. I feel used I dropped other jobs to come to this place because it was temp to hire now I’ve been contracting there for 6 months and they plan to dump me in 3. Any advice? Anything I can do?

    • 10 til 2 says:

      Mark: Unless the terms you mentioned were written into a contract, you are probably out of luck. While it may seem of little consolation, we suggest you use this as a learning experience so history doesn’t repeat itself… make sure to get everything promised to you in a signed contract. Understand that we are not employment attorneys; if you would like expertise on your situation you should contact one. Best of luck to you.

  74. Bobby Larson says:

    I worked for a wholesale floral company. I started as a delivery driver where I was a W-2. June 2013 I took over as an operations manager and given a small raise and was told after six months I will be given an evaluation and an adjusted raise. In November 2013 my wife and I inherited a little bit of money and we decided to put my 5 week income $5,000 towards my company’s 401 K which they will match. I had already contributed $7,000 since I had been with the company.
    On December 30, 2013 I called HR to acknowledge that this was in place and I was told yes. On January 3, 2014 when I went to work my boss and his boss came in from headquarter and I asked if this was my evaluation. They replied “no it was not necessary” but one of them asked how I felt about being an independent contractor and having to file under 1099. I asked how much they would be compensating me. Their offer was $1,000 per week with no benefits. (No life insurance, or 401k contributions) This was less than I was already making. I said no. So they decided to terminate my employment. After I left the company sent me a check for $12,000 and claim they are no longer offering a 401 K plan. No matching contributions or accrued interest! I have had to hire an attorney but he said there are a lot of scum bags and they are corporate jerks. The state department of labor also were not helpful. Workers beware!

  75. edgar gaona says:

    Hi, my cuestion its :
    I was working 4 this flooring company i was geting pay hourly
    With check but cash no deductions they provide materials and i have 2 be there whenbthey say (as a regular employee) can my boss 1099 me?

    • 10 til 2 says:

      Edgar: Probably not, but it is hard to say with such limited information. Best to contact the Department of Labor or an employment attorney for a definitive answer. Good luck.

  76. Katrina Ko says:

    Please if any can help me or give me some advice with my current situation..
    i worked a job that i had a feeling was somewhat “under the table” since we never got individual pay stubs, just personal checks. I was just a part time employee at a tea shop..i am a college student..
    I had asked my employer when she had us fill out tax forms, whether she was paying all our taxes and i made sure with her that we wouldn’t have to pay taxes at the end of the year.. and she said yes dont worry i am paying all the taxes for you guys already..

    the problem now is that i received a payment form from IRS saying that I did not report about $7000 of “nonemployee” income filed under 1099-misc
    and i have to pay the taxes for that (about $1500)
    i talked to my previous employer right away and she said she will ask her accountant..
    i dont know if my employer is really just clueless about 1099 and the law or what it is… but i talked to her several times about it and it has gotten nowhere.. she keeps coming up with new excuses..
    i dont feel like i should be the one paying these taxes.. i don’t have proof that she said she was withholding anything for me..what can i do if shes not taking responsibility?

    • 10 til 2 says:

      Katrina: Sadly, there is a lesson to be learned here. There are inherent risks, including possible illegal employment and nasty compensation issues, when accepting a job that is under the table. Are you aware that even legit employers who do everything correctly do not pay 100% of your income tax obligation? How much tax you pay is determined in part by how many exemptions you claimed on your W4 form. Did you actually fill out a W4?

      We strongly suggest that you determine your legal rights. Keep in mind that a lawyer will probably end up costing you more than the $1,500 you currently owe; so your best best is to contact the Department of Labor.

      Best of luck to you and keep us posted!

  77. Katrina Ko says:

    yes i had filled out a W4 form.. when i began working for them they had given me these forms to fill out so i figured she was doing taxes for her employees, that is why i asked her if she was withholding and paying the taxes and she said she was.
    Would i have the upper hand here since i am obviously not suppose to be filed as 1099..?
    it just doesnt seem right that i have to pay all these taxes..

  78. Shocker says:

    Am working as a independent contractor doing deliveries for a food delivery service where I get paid a personal check each week from the company that subcontracts me and get paid daily in cash for the tips I make. I get paid the delivery fee, $1 in gas for each delivery ( which employer pays me) and the tip. My employer (the company) tells me he’s giving me a 1099. I was not told I was getting a 1099 cuz I thought it was an off the books job, and where or even if does this fall under misclassification or should my employer be responsible.

    • 10 til 2 says:

      Oh, Shocker. There is so much to address here. In your first sentence, you claim that you are an independent contractor and then sound surprised that the company gave you a 1099. The fact is, independent contractors receive 1099 forms. Period, end of sentence. So the fact that you called yourself a contractor is in complete alignment with you getting a 1099. And let’s make it clear, if you are indeed a contractor the company is not your employer, but rather your client. Claiming that you are working off the books (AKA under the table) is no defense, in fact it is illegal, so we suggest you don’t pursue that route. Now that we cleared that up, you need to determine whether you are truly a contractor or should be classified as a W2 employee. If the company is supplying you with the truck, you are likely an employee. No matter what the outcome, somebody needs to pay Uncle Sam. Please keep in mind, we are not labor attorneys; we are simply giving you our opinion based on our knowledge of the employment sector.

  79. Angela Maturino says:

    I recently won a child support arrearages court case with my ex who with his fiancé own a small cafe. She is the legal owner. He tried to say he just helps out and didn’t get a salary but when the judge issued a seek to work order he decided he did work there and his fiancé put him on payroll. Fast forward a month after the case is done she takes him off payroll. DCSS says oh she probably has him on a 1099 and there is nothing you can do. Isn’t that illegal? He’s not a temporary employee.

    • 10 til 2 says:

      Angela: Temporary employees and 1099 contractors are two different things, so it is important not to get them confused. What your ex does at the restaurant and the manner in which he does it are two of the determining factors as to whether he is a 1099 contractor. If his employment status concerns you in some way, the matter is best left in the hands of your attorney.

  80. Ron says:

    I was a commission salesperson at a furniture company in Ohio. He refuses to pay the amount he owes me because he states i was an independent contractor. What requirements are needed to prove i was an employee?

  81. Susana D says:

    OK, so my boyfriend and I worked at the same place, a restaurant, both as servers. I was given a W-2 and he was given a 1099. The difference is our legal status. I have a social and when he first worked there he did not. He had a tax id number ( whatever that is lol). During the year, he finally received his work permit that and got his social security number. He gave it to our manager. Fast forward, we both quit at different times, I got my W2 a month ago and he JUST now got something. Only because we were annoying the accountant for the restaurant. But what he received was a 1099. We are both confused as to why he was given the 1099. Because he didnt have a social? He says he had always received a W2 regardless of his lack of ssn before this restaurant. Any advice or suggestions as to why he was given a 1099 in lieu of a W2? ( We were both servers and performed the exact same duties/jobs).

    • 10 til 2 says:

      Susana: We are not employment attorneys, so we suggest you or your boyfriend speak to one or call the Department of Labor in your state. But we will tell you this: Claiming a restaurant server is a 1099 contractor sounds absolutely ludicrous in our opinion. Good luck to your BF and keep us posted.

  82. seth says:

    Okay, so I was hired last year to clear out, repair, and and clean houses for resale by a contractor to these jobs for real estate agents. Now he said we were independent sub contractors.. But he told us what our daily pay would be, when we had to be at work, what we could or couldn’t do, when lunch was, and when we went home. Now I’ve never done this work, nor do I know the rules, laws, or my rights. But he was my boss so I did as he said. Im only 20 yrs old and I’m confused as to whether not I should be 1099 or W2. I don’t have much money and don’t believe I can afford 1099 taxes. Was I misclassified? And if so do I file or how do I go about this the right way so the IRS isn’t hounding me..

    • 10 til 2 says:

      Seth: First, independent contractors do not have bosses or employers; they have clients. It definitely sounds like you were told the exact way in which to provide your service, which would seem make you a W2 employee. Here is a great tip for future reference: Upon being hired to any position or contracted for any job, you should be given either a W4 form or a W9 form to complete prior to starting the work. W4 means they are treating you as an employee and the W9 means they consider you a contractor. But these are not arbitrary choices the “employer” can make. Check out this page on the IRS website to see how it explains the parameters of employee versus contractors. As we have mentioned, we are not employment attorneys, so if you have any further questions we suggest you speak with one or contact the Department of Labor in your state. Good luck.

  83. seth says:

    Also, I’m working out of Illinois and was fired on the job for accidentally breaking a mower while being told to mow 1ft tall grass…

  84. Susan says:

    so, you explain the difference between a ‘duck’ and ‘not a duck’ very clearly. And advising employers not to do this.
    My question is this: if an employer wants to hire someone on, with 1099 status, even though really they should be an employee, is there any legal or tax risk to the ’employee’ if they accept this status.

    • 10 til 2 says:

      Susan: While we are not certain that there would be any legal risk for an average employee to mistakenly accept a position classified as a 1099 contractor, they are then stuck with the entire tax burden due Uncle Sam. We are not employment or tax attorneys, so for a definitive answer to your question we suggest that you contact one or the Department of Labor in your state.

  85. Caroline says:

    Full time employee, been working for a company a year. Brought in as “part time.” When benefits were supposed to kick in, status was changed to “temp”. Therefore no benefits, yet no staffing company involved. Full time hours. Treated as or should be a W2 employees. Is this legal, not getting benefits (PTO, insurance…)

    • 10 til 2 says:

      Caroline: According to the government, there is no such status as a temp; you are either a W2 employee or a 1099 contractor. Did you sign anything that outlined the dynamics of benefits and employment status at the onset of the job? If so, they are likely contractually obligated to honor whatever promises they made. We think this is worth looking into; as we are not employment attorneys, we suggest you speak to one or contact the Department of Labor in your state. Good luck and keep us posted.

  86. Judy says:

    My son spent last summer working approx. 60 hours per week mowing lawns for a lawn mowing service. He used their equipment and was directed daily on where to go and exactly what to do. He was paid cash and issued a 1099. Of course now that it is tax time he is being required to file as self employed and pay the employers 7.65% fica tax. Should he be a W-2 employee and should I file a SS-8? Also, if he is reclassified as a W-2 employee is he entitled to any overtime compensation (he was paid only straight time)?
    Thank you

    • 10 til 2 says:

      Judy: It is interesting that so many business owners think that just because their company is an independent contractor, that their workers are too. A great deal of the time this is simply not the case. People need to be aware of how their job status is addressed at the beginning of their contract or employment. All W2 employees are required by law to complete a W4 form, on which they record information including their exemptions. If one is not asked to fill out a W4, then they should have some very strong questions and concerns as to their employment status. We are not employment attorneys, so we suggest you contact one or the Department of Labor in your state. The silver lining is that he learned a valuable lesson early on that should stick with him throughout his future employment. Good luck and keep us posted how everything turns out.

  87. Ed says:

    Worked 3 years as full time (w2) employee. Company bought out. Being switched to 1099 employee for 60 days. If no positions will be laid off. Worried about the 1099 tax implications. Am I technically laid off right now and can seek DUI benefits?

    • 10 til 2 says:

      Ed: First off, there is no such thing as a 1099 employee; the term 1099 refers to independent contractor status, which basically means that your provide a service that is beyond the scope of being an employee. As far as you technically being laid off, you might have a strong argument there. We are not employment attorneys, so for a definitive answer to your question, we suggest you contact one or the Department of Labor in your state. Good luck… we would love to know the outcome.

  88. William says:

    Ive been doing construction work since april of last year. I have been using there tools, vehicles, t-shirts (supposedly for advertisment) the whole time. They gave me a 1099 form. My brother also works for them and is in the same boat as me. I’ ve always been told when to report to work. They also aren’t negotiating pay with me. Ive been getting paid $8 hourly the whole time ive worked with them. In the month of January me and my brother did a mold job for them using the equipment and safety materials they provided. My brother got sick due to an allergic reaction to mold and insulation. Before we even started the job the employer told us that if we refused to do the work that they would fire us. Now my brother has an unpaid hospital bill and the employer is telling us that he isnt legible for workers comp. I know for a fact that he has to have workers comp insurance because he has more than 3 people working for him. Is he suppose to be held liable to pay that hospital bill since we are really suppose to be employee’s? I also Know that my employer has miclassified us as an independent sub-contractor. What are my right’s? Would I have the right to sue?

    • 10 til 2 says:

      William: We strongly urge you and your brother to contact an employment attorney, as we are not lawyers and it certainly sounds like you need one. Good luck and keep us posted.

  89. Gail Suzanne says:

    To all of you who have been laid off from a job as an “independent contractor” – file for unemployment. If you are indeed a misclassified employee you will qualify for unemployment and the employer will be fined and possibly investigated for employment law violations. How do I know this? It happened to me. I got unemployment benefits, and the Fortune 500 company I worked for is getting investigated and fined. Guess what my former employer is not doing anymore.

  90. Ethan says:

    I have been working for past 2 years as a contractor for a vendor but on client site about 47 miles from my home, 5 days a week and something one days from home in month, where clients provides laptop and other things which are required for me to complete the work. I have been told to be in the office at 9, work on this which they want to me to and run projects, give them status and one hour lunch break. I have been on W2 with the vendor where he cuts all my taxes Fed, State, SS and MC, State Disability but does provide me Insurance, basically the insurance they offer me is paying my insurance myself would be cheaper.

    Now question is what they are telling me is wrong to be in the office on time by 9,drive 47 miles, use my own gas, use my own phone to take and make calls as need when home for meetings and vendor is not ready to convert me to 1099.

    Can i deduct all these being on W2 with vendor where they can kick me out the next day and not pay anything for not worked days and PTO.

    I have rented a small place below my house (House is also rented, i don’t own it) for office use as my house is too small to conduct any meeting or to set up a home office. Can i deduct these mentioned about items my taxes or no….

    I don’t know how they are classifying me but i do get w2 at the end of the years. but my job is with no benefits are all just salary.

    Help me please. Thanks

    • Ethan says:

      Sorry forgot to mention. They make us work more than 8 works and not paying overtime for off source meetings taken from home in the evening or at night.

      This is wrong I hope?

    • 10 til 2 says:

      Ethan: First off, if you are getting a W2, you are being classified as an employee not a contractor (sounds like your boss, AKA the vendor, is a contractor, but you are an employee of the vendor). Also, if you are a salaried employee, your employer might not be obligated to pay you overtime and is only obligated to extend certain benefits to you (like those mandated in the Affordable Care Act and Family Medical Leave Act). We are not attorneys; if you have concerns regarding your employment you should speak with one or contact the Department of Labor in your state. You might also contact a tax professional regarding what you can and can’t write off. Best of luck to you.

      • Ethan says:

        Thats the confusion, they are classifying me as contractor on the contract they got me signed and pay me hourly 80 hours bi weekly and 160 monthly and if i take a day off i don’t get paid but i’m on W2, which doesn’t make any sense that how they are running this back in their system and under what they have classified me.

        This is so annoying that i want to take an action on this and get things straight out but before I do that i want to know at least that whether I have been duped out or not.

  91. Cindy says:

    Here’s my question – if an employee is being paid as a 1099 and is told when to be there, what to wear, when to take lunch and uses all their computer programs and software and works only 32 hours per week are they still a 1099 or should they be classified as a w-2? In other words, do weekly hours have any affect as to whether or not you are a w-2 or a 1099??

    • 10 til 2 says:

      Cindy: The number of hours you work really have no bearing on whether you are a 1099 contractor or an W2 employee; everything you described sounds exactly like a W2 employee. Please keep in mind that we are not employment attorneys; if you would like a definitive answer to your question we suggest you speak to one or contact the Department of Labor in your state. Good luck.

  92. Sarah Evans says:

    I have a question: I’ve been 1099 for a non-profit in the first quarter of this year. I recently was hired. the accountant tells me he must deduct taxes for the first quarter right now. he says you cannot be a 1099 and a w2 in the same year. That makes no sense to me. plenty of people go from contract to permanent in a year or from w2 to contract. Is what our accountant saying true?

    • 10 til 2 says:

      Sarah: It might sound odd, but it is likely true and has to do with how employers file their workers and EIN with the IRS. While it might seem annoying to you, you will likely be better off in the long run because as a 1099 contractor you would be responsible for a much larger portion of the tax burden accrued in Q1… this way, your employer will be picking up a good chunk of it. Keep in mind that we are not employment attorneys, so for legal expertise we suggest you contact one or the Department of Labor in your state.

  93. pricklypear says:

    What if you have an “on call hotel babysitting service”? Let’s say these providers have inconsistent hours and their total number of jobs can be once a week – once a month- 10 times a month, but the Agency collects a booking fee – and the parent who hires them for the babysitting job at the hotel (as a vacationer to the area – like Hawaii) – pays the nanny cash only…….

    • 10 til 2 says:

      Pricklypear: Sounds like the babysitters are independent contractors, as we assume they can refuse the work, don’t have a specific dress code/uniform and essentially don’t have an employer beyond the scope of each individual babysitting gig. We are not employment attorneys; if you want a definitive answer to your question we suggest you contact one or the Department of Labor in your state.

  94. pricklypear says:

    Yes, they can refuse the job… don’t have specific hours and don’t have a uniform. And as for the Dpt of Labor – that’s what my insurance agent told me as well… Thanks!

  95. Terry says:

    i have been working in a private company for almost a year now and yesterday my employer told me that I have been laid off. I was w2 since i started with them but now I asked them if I can do a 1099 for my last paycheck, and they said they will not do it with no explanations or whatsoever, can they do that or is it my right to change from w2 to 1099? thank you so much

    • 10 til 2 says:

      Terry: W2 and 1099 status is not an arbitrary decision one can simply make on a whim. You either qualify as a W2 employee or you are a contractor; it is pretty much that simple. So if you were a bona fide employee for the duration of your time with the company, you can’t just opt to switch employment status. Also, from our understanding, an employer cannot file you under the same EIN as both an employee and a contractor within the same calendar year. We are not employment attorneys; for a definitive answer to your question, we suggest you speak to one or contact the Department of Labor in your state. Good luck to you.

  96. josecuervo says:

    I live in Austin, Texas.
    I was offered a 1099 sales job for an internet start up of 7 employees.
    My concerns are in reference to
    1 residuals
    2 profit sharing
    3 stocks
    4 no benefits
    The base is good
    If I am 1099 I am curious why I was emailed anything related to timekeeping
    He also sent me a non compete
    I am in the internet industry
    2/3 of Austin jobs are internet
    The non compete will be an issue in the future
    What do you suggest ???

    • 10 til 2 says:

      joesecuervo: Sounds like you have some valid concerns; we suggest you contact the Texas Department of Labor for clarification. Good luck.

  97. Ally says:

    I just was offered a full-time, salaried position, working 9-5, set hours in a company office. I was told I would be a 1099 employee for the first 90 days. I have never been a 1099 employee, always a W2. This is not a sales or commissions job. I am expected to work 40 hours a week, report to my boss, follow all company rules, use company computers and office supplies. Why would I be a 1099 employee for the first 90 days? I’m very confused and concerned how this well affect my taxes. Any advice?

    • 10 til 2 says:

      Ally: Not sure if this is the case in your situation, but sometimes companies will use an outside staffing firm to run payroll on new employees for the first 90 days of employment. This mitigates the company’s costs while they determine if a new hire is the “right fit” for the company (bringing on a new employee costs employers a ton of money). If you have not already accepted the position, you could certainly try to negotiate those terms if you think it is in your best interest; you might also consider talking with the HR department to learn how all this affects your taxes. We are not employment attorneys; for expert advice on your question, we suggest you speak to one or the Department of Labor in your state. Good luck and keep us posted.

  98. Sean says:

    If the NY labor board is auditing a company, what would my exposure be if i were improperly classified as a 1099 employee?

    • 10 til 2 says:

      Sean: Your question is a good one; in all likeliness the board will review all employee and contractor records. From our understanding, while misclassified contractors don’t get compensated for the extra portion of the taxes they paid during the time they should have been classified as a W-2 employee, there is likely no added financial burden either. Please understand that we are not employment attorneys, so for expertise on this subject we strongly suggest you speak to one or contact the NY Department of Labor. Also, you may want to read this informative blog post entitled “Misclassification of Employees as Independent Contractors – What’s That Mean?” on the LexisNexis website. Good luck and keep us posted.

  99. Kenny says:

    I’m an electrician. I’m being told I have to be to work at 7 o’clock and I’m not allowed to leave until the job is finished. It could be 4 o’clock or It could be 9 o’clock at night when I get off work. I have to take a 30 minute lunch. All electricians have to supply small hand tools. And he supplies the bigger tools. I feel like I should be getting my w2 but he gives everyone a 1099. Is this legal?

  100. Kenny says:

    I also have to drive his company truck.

    • 10 til 2 says:

      Kenny: Sounds like you might be misclassified as a contractor. This happens a lot in service companies; owners of these businesses often mistakenly assume that because their companies are considered contractors, their employees are also contractors (which isn’t necessarily true). As we are not employment attorneys, we suggest for a definitive answer to your question that you contact one or the Department of Labor in your state. Good luck and keep us posted.

  101. Lesley says:

    OK I work for a lady who has her hands in a little of everything… Cleaners and painters that may move from place to place days and pay may very… however I work set times set days and set pay at one place. She gives everyone a 1099 but she cuts everyone .07% out of each check and now she want every including us how stay in one spot with same hours and same pay to go get a business license but not to work here at her place but tell the we want to open our own cleaning company? How is this right?

    • 10 til 2 says:

      Lesley: Not sure that is is.We suggest you contact the Department of Labor in your state. Best of luck to you.

  102. David says:

    I’m not sure I understand why it really makes a difference as long as the employer and the employee agree on salary and benefits. Does Uncle Sam get more or less either way?

    I want to work part-time, special projects. A company brings me in for a limited amount of time until the project is over. Full time, in the office, with a boss, set hours etc. I’d base my compensation on having to pay both shares of FICA and submitting my quarterly tax obligations. I don’t want any benefits and wouldn’t expect any.

    1099 just seems easier to work when I want and much more flexible.

    • 10 til 2 says:

      David: While self-employment tax is generally equivalent to the combined employer/employee tax contribution, Uncle Sam does likely generate more revenue from employees rather than contractors. For example, contractors do not have to pay self-employment taxes if they earn under $400, while employers have to pay FICA starting with the first hour an employee works. The self-employed also often claim more deductions when filing their taxes (half of self-employment tax, i.e., the employer-equivalent portion, is allowed as a deduction against income for contractors).

      There is also a fairness issue, as employers often misclassify workers to avoid paying their portion of the tax burden and often pay these workers the same hourly rate they would an employee even though the worker carries a greater portion of the tax burden.

      In the scenario you pose, there are two things that stick out. One, when you are a contractor, you don’t have a boss, you have a client (even if you need to report to someone, he/she is usually considered a client). On the other hand, you set your own compensation at a rate you feel reflects your added tax burden as a contractor; which is good.

      Sounds like you are savvy and going into this informed; unfortunately, many workers have no idea how misclassification can affect them.

      Keep in mind, we are staffing specialists, not employment attorneys. For a definitive answer to your question, we suggest you contact the Department of Labor in your state.

  103. Elle A. says:

    I am a full time student working part time at a company and I am classified as a 1099. I wanted to be a W2 for end of the year filing purposes, but my boss said that if I make less than $7,500 a year (which I will) then I wouldn’t have any taxes to pay when I filed. Is this true? I chose my hours, and the jobs they give me here are not extremely specific nor do they have any set time to be completed by, so I’m guessing I am correctly classified.. But I want to have my facts straight by the time filing comes around.

  104. Pauline says:


    I hired a friend of mines to do on-call work for me for about a year.

    She would call clients based on their appointment times made with me.

    Would she qualify as an employee or a contractor?

    I didn’t assign her a fix time or hours, everything was done by appointment. If she was not available to call the client, I would make the call myself.

    Please let me know thanks.

    • 10 til 2 says:

      Pauline: There are more things to consider when determining contractor status. We strongly suggest you contact the Department of Labor in your state for the answer to your question. Best of luck to you.

  105. Leon says:

    I recently accepted a job through a temp agency as a data analyst. The temp agency gave me a 1099 form, but I didn’t think anything of it until now. This is my first time dealing with a temp agency.

    I work 8 hours a day, Monday through Friday. I only work for the data job, at the data job’s location. The data job tells me what to wear, when to arrive and leave, and when take my breaks. They have trained me to use their equipment, and told me how to work.

    So, why has the temp agency given me a 1099 instead of a W2? Will this be a huge headache for me come tax time? I REALLY can’t afford to be hit with any tax penalties, and now I’m very nervous about what to do.

    • 10 til 2 says:

      Leon: It is hard to say whether you are an employee or not; but you should know that staffing companies are not immune to contractor misclassification. We are not lawyers; so we strongly urge you to contact the Department of Labor in your state or an employment attorney for a better understanding of your situation, your rights and your options.

      Whether you are misclassified or not, you likely will not be hit with any penalties per se; but as a contractor you are responsible for a greater chunk of your employment tax burden (now you can see why employers are tempted to misclassify employees as contractors). That being said, it is wise that whenever you are doing contract work to set aside a portion of each check for Uncle Sam so there are no surprises come tax time.

      Here is an interesting article on MOndaq.com regarding the risks staffing agencies assume when they misclassify employees: http://www.mondaq.com/unitedstates/x/217738/employee+rights+labour+relations/Staffing+Agencies+Using+Independent+Contractors+Face+Misclassification+Liability+And+Expose+Clients+To+Undue+Risks

      Good luck and please keep us posted.

  106. Amy says:

    Dear John- thanks for your blog and for such amazing responsiveness to posters! My question is a bit odd- I’m a contract stylist (I rent a booth and keep my client fees) and my employer (the salon owner) covers my insurance out-of-pocket each month. In January, we began accepting Groupons; normally, a stylist would accept half (or so) of a Groupon’s value in exchange for styling a client (Groupon receives the entire amount and disburses a check of the agreed-upon %age to the stylist). However, my boss said he would cash the Groupon checks to his own account instead of me getting them (I literally never saw them/cashed anything, although obviously I should’ve been keeping track), in order to cover my insurance. Now that he’s been cashing these checks since Jan., (while covering my $350 insurance/month), he’s informed me he is going to “1099” me for my insurance “income” each month. To me, it seems like that “income” was canceled out by the Groupon checks that he was cashing (I made nothing off styling those clients). I’m totally confused, but I do feel like he’s sort of “double-charging” me- can you me understand this issue? Thank you so much! -Amy

    • 10 til 2 says:

      Amy: There is no “John” here, but thanks for your kind words and we will try to address your question to the best of our knowledge and ability. First off, keep in mind that we are not lawyers, so it is important to contact an employment attorney or the Department of Labor in your state for an expert answer to your question. In the meantime, here are some things to think about: First and foremost, read your contract. While we have a hunch that the salon owner may simply be your landlord, one thing is almost certain; since you are not giving the salon a percentage of your sales to cover your insurance, then the owner of the salon built that cost into your monthly booth fee. This should all be painstakingly spelled out in your contract; and the contract in all probability can’t be altered by a single party and without a new amended contract signed by both parties. Also, there should be a clear agreement in writing as to how to handle his Groupon offers including your agreement to provide those services and the terms of your compensation related to those services. Long story short, it is important to review your contract (especially as it relates to those insurance payments). Really, we strongly urge you to speak with an attorney. Please keep us posted on how this turns out!

  107. Myrna Setiawan says:


    I have a music school that provide lessons, renting hall and sell music books, etc. I contracted freelance musicians to teach students [one on one lesson]. Would these teachers be considered 1099 or W-2 if the conditions are below:
    1. Teachers control their own schedules. Some of them only have limited times due to their other jobs.
    2. I don’t tell them how to do their job. I don’t train them to teach
    3. They bring their own music instrument to teach
    4. They use their own method to teach
    5. They can dress whatever they like
    6. They are free to work at other music schools, take private students on their own home & they have works elsewhere as performers, have their own students by teaching them either at their own home or going to students’ places, etc
    7. They can change their schedule whenever they have other conflicts with other engangements or gigs.
    8. For Teachers who teach piano, I start charging rent for piano use recently.
    9. These teachers are not paid minimum wage. They are getting about 70% off student tuition as their payrate, which is about $40.00 – 45.00/hour student.
    10. The most important thing is: They want to be 1099s as they know they have multiple jobs and they want the freedom to be able to accept other jobs.

    Would these be considered 1099 workers?

    The problem I am facing is not with the teachers, but with CA EDD [Employement Development Department] that insisting that these teachers are misclassified & slapped me with an initial bill for $90,000. Am I being taken advantage by government power here as all the process was done within EDD circle, hearing conducted by EDD admin law judge, Appeal that got denied by EDD Sacramento Office? Please share your comments as I might have to close down the school simply can not afford to hire W-2s. Thank You.

    • 10 til 2 says:

      Myrna: With the CA EDD already ruling on this, we feel it wouldn’t be prudent for us to weigh in too much, as we are not employment attorneys. Keep in mind though; #10 may not be as strong of a point as you think. Just because workers are able to accept other jobs does not necessarily make them contractors; many employers allow their employees to moonlight. Have you checked into the legality of restructuring your business model to better serve your needs… perhaps a system where the instructors pay you by the hour to lease your space (a little more for the piano) and the student pays the instructor directly? Again, we don’t really know your legal options as we are not attorneys; so we strongly urge you to speak with one or contact the Department of Labor in CA. Best of luck to you and please keep us posted.

  108. Travis K says:

    I am a small one man cleaning company looking to take on more business and work a little less on actual jobs. I had planned to hire someone to help me but got scared when I realized that putting someone on w-2 adds about 24% to cost of payroll. Adding one employee and giving them 30-40 hours of MY work seems expensive enough to start. Let alone trying to give them a fair wage and then add 24% for payroll until over 10K for the year(then 17%) seems absurd. I am in a very low margin/low profit business.
    THE PLAN: I would hire them and give them all needed supplies other than a vehicle. I would give them basic training and then (provided they aren’t retarded) assume they could figure out how they would like to vacuum and empty trash cans 9and in what order they would like to accomplish this. obviously some customers expect us to be on time (residential) but many (commercial) could care less what time we show up as long as work is reasonable. If anyone could answer whether I am allowed to and can 1099 these employees that would be very much appreciated. I would have to assume employees would want 12.40/hour versus 10.00/hour? I am simply the same, as I would rather pay a lesser number while effectively paying the employee more.

    • 10 til 2 says:

      Travis: This is really a question for the Department of Labor in your state or an employment attorney. Good luck.

  109. John Winters says:

    Was just notified that my company is closing. The company taking over their contract doesn’t hire “employees” to do the job, it signs on “independent contractors”. I deliver and install appliances. If I am required to be at work at a certain time, wear their logo on my shirt and and drive a route they set up with scheduled time windows (the same as the job I’m losing), how am I NOT an employee?

  110. John Winters says:

    Add to above: I would be signing on with one of their contractors who would sub-contract me and driving HIS truck at a flat-rate per day.

    • 10 til 2 says:

      John: It sounds like you suspect the same as we do, which is that you would actually be an employee of the company that contracted with the company that took over the business. However, we are not employment attorneys, so we strongly suggest you speak to one or the Department of Labor in your state. Also, take a look at a little poster we created that addresses this exact subject at http://tentiltwo.com/pt-career-blog/1099-fun-fact/. Best of luck to you.

  111. Ralph Stoneburner says:

    This is my second/comment. In June or July last year I terminated employment and was asked to return as a consultant (1099 employee). You answered the questions I had.
    My “Consulting Services Agreement” contract was renewed for another 12 months on January 2014.
    For the past18 months now I have been working solely for the same contract firm.
    In short, my contract states that I will perform the exact functions as W-2 employees. It lists 18 duties expected of which are basically the same I used to perform as a W-2 employee. This pretty much parallels the duties of a W-2 employee. I have been directed to write and submit programs to a web site used by the company clients to verify compliance. Along with being directed to develop specific trainings NOTE: I have also been directed to perform incident investigations and develop corrective plans, exactly what did as a W-2 employee.

    The company also furnishes a vehicle, gas card, computer, cell phone and pays for all maintenance on said vehicle.

    Even though there is the Indemnity Clause in the Contract. It basically states:
    If a regulatory body or court of competent jurisdiction finds the Consultant is not an independent contractor or not in compliance with Independent Contractor laws based on the Consultants own actions, the Consultant will assume full responsibility for all costs incurred against Consultant or Company resulting from that contrary interpretation (taxes, assessments and penalties that would have been deducted , and penalties
    that would have been deducted from the Consultant’s earnings, and the Consultant had been on the Company’s payroll as employed as a Company employee.
    Sorry this is so long but I would appreciate your thoughts and comments.
    Seems to me I am still a W-2 employee? This fits a lot of your article – Top 10 Signs You Are Being Misclassified as a 1099 Contractor.
    One more thing, I have just recovered from surgery and was told by the Company Manager I need to their industrial doctor for evaluation even though my surgeon released me to full duty. This evaluation requirement is not provided in the contract.



    • 10 til 2 says:

      Ralph: We STRONGLY urge you to contact an employment attorney or the Department of Labor in your state. The indemnity clause is particularly concerning; while we are not employment attorneys, the fact that the company is making you financially responsible for their tax burden if they have misclassified you as a contractor is suspect at best (and it is certainly valid to ask an attorney about the legality of such a clause). Please be diligent about following up on this and keep us posted. Good luck to you.

  112. erica says:

    I am currently working in a salon under 1099. I do have to follow a dress code and work specified hours. I use their product but my own tools. I am on 45% comission to me 55% to them with 34 dollars taken out of my 45% to go to a cleaning crew. I do not know if I am being taken advantage of or if this is the norm.

    • 10 til 2 says:

      Erica: While we know that many stylists are valid 1099 contractors, it is hard to weigh in, as we are simply not experts in your area. We suggest you talk to the Department of Labor in your state if you have concerns. Best of luck.

  113. David Hill says:

    I work for my brother so I don’t know what to do. He came to me 3 years ago and asked me to come work for him he said I will start you out at 10$ hour then give you raises. I’m now at 15 a hour he will not hire me the job is telecom and datacom. He does not hold taxes on me. But he controls me and I don’t have a high school diploma so it will be flipping burgers if I don’t do what he wants. I have been depressed for some time now and very stressed. I don’t sleep good because of all this and it seem to make me over sleep and he tells me if I keep being late he will find someone else. I’m not sure how long of a comment I can make but there is a lot more to this. I have not filled my taxes the passed 3 years because I have not made but maybe 8,000 last year that’s the most ever. I have never been given paper work telling me how much he paid me. 2 years ago he could not get a drivers license so he paid cash for a truck and used my name and used my name for insurance. But it was his truck he even wrote off 10,000 saying he bought the truck. Now I’m with no license and no car in debt. I feel I have been run over and used and now I’m going to be stuck with nothing. Please help. I don’t wont him to get in trouble but I have seen enough to know he don’t care what he has done to me.

    • 10 til 2 says:

      David: This truly is not a forum that can give you the answers you need; but it sounds like you might want to consider getting your GED so you don’t feel so trapped. You also might want to consider speaking to an employment attorney. Best of luck to you.

  114. Phil says:

    Another great example of “the best of intentions” harming rather than helping workers.
    What if I DON’T WANT to work for one employer full time?
    Tough, now there’s every reason why potential clients don’t want to hire me temporary.
    I hate this kind of government interference with my life!

  115. Joanna says:

    I get pay salary instead of hourly, but receiving 1099. Should i get pay for holidays? The company i work for said i don’t because i am on 1099. I thought when i work as salary, that means i work overtime and not getting pay for those extra hours, so i should get pay for holidays right?

    • 10 til 2 says:

      Joanna: If you are truly a 1099, the company probably has no obligation to give you paid holidays. But check with the Department of Labor in your state for a definitive answer to your question. Best of luck to you.

  116. Chris William says:

    I was issued a 1099 which was supposed to be temporary by (NAME OF COMPANY REDACTED) he paid me by the hr at 10 an hr. On multiple times he couldn’t pay us cause he supposedly didn’t have it. When I worked for him I used his tools and was told where to go and how to do the job. I then got hurt on a job and was responsible for the hospital bill. So he then cut my hrs and owed me money. I contacted him multiple times to get the money I was owed.. I was a little scared that he was goin to pull the same excuse that we were told before. He wouldn’t answer me until I said that I would get the police involved.. When he did finally answer he was rude and belligerent and called me names which was pretty childish for an adult. For example there was a job we did where he made around 8000 dollars and paid me 100 cause I worked 10hrs. I want to report him for fraud to the IRS I have sent in form 3949-A. I want to do this cause what he is doin is not right taking advantage of people and has to take responsibility for his actions of defrauding the U.S. government.

    • 10 til 2 says:

      Chris: We suggest you contact an employment attorney or the DOL in your state if you haven’t already done so. Good luck to you.

  117. Joanna says:

    thank you for your reply :O)

  118. Joe says:

    Recently i got a job as a painter. They’re paying me hourly making sure i wear painters clothes also they are telling me when i can take a break or lunch and what time to clock in and out. I report to a supervisor everyday both myself and my partner. I am in no way shape or form an independent contractor they provide the tools and materials and its always on they’re premises i work the same hours daily for the last few months and i fill out a time sheet weekly that states my hourly wage and they got me working on a 1099? Is this employee misclassification or not? Not sure what to do. Any help is appreciated i’m located in nyc.

    • 10 til 2 says:

      Joe: Employee misclassification is very common in fields like yours (click here to check out a related post). While your 1099 classification sounds suspect to us, we are not employment attorneys so are not in a position to give you professional advice other than to suggest you speak to an employment attorney or contact the Department of Labor in your state. Good luck and keep us posted.

  119. Rob says:

    I’m an insurance adjuster and get paid by 1099 from the owner of the claims company. Occasionally, my wife comes with me to assist in measuring rooms and taking photos. Then, she assists me in writing my reports by using a sketch program and labeling and organizing the photos. We work out of my home office and she has no set schedule. Should I pay her a 1099? If so, how would this work on our joint taxes….I know she has to claim the 1099 income, but does she do so under her own Schedule C company? Thanks in advance for your time.

  120. Rob says:

    Addendum to my previous post: I forgot to mention that I file a
    Schedule C for my 1099 income.

  121. Mia says:

    Hello, I am one of the owners of a trucking company (s-corporation). I have 50% share of the company. I am one of the truck drivers of my company. How should I get paid? As an employee or as an independent contractor? For my tax return should I use 1099 or w2?

    • 10 til 2 says:

      Mia: Our best guess would be that you qualify as an employee in your role as a truck driver; but this question is beyond our bandwidth. We suggest you contact an employment attorney or the DOL in your state for guidance. Good luck.

  122. NotMyName says:

    Hi, I just got hired to clean houses by a small (4-6 people) cleaning company. I spend 12+ hours a day cleaning clients houses. The owner said outright that she uses 1099 forms because she can’t afford to pay extra taxes. First off I am wondering if thjs is OK for them to do. Secondly I am wondering if you had any helpful links or information about how much I can expect to pay in taxes, when I am supposed to pay them and how? Thanks.

    • 10 til 2 says:

      NotMyName: While we are not employment attorneys so are unable to give you an expert opinion, you just might be misclassified as a contractor. Many small businesses find themselves in a pinch when the going rate for their services makes it difficult to bring on employees; and mistakenly think they can get the people they need by simply classifying them as contractors. While that might not be the case in your situation, it might be worth looking in to.

      To answer the rest of your question, we suggest you visit the IRS website; they have all kinds of helpful information and worksheets. Best of luck to you.

  123. teresa says:

    I work in a hair salon, I have a set schedule & must work set hours & use the products stocked in the salon, color, shampoo & etc. I never signed a independent contractors contract I am only paid a commission my dilema is the owner wont give neither w2 nor 1099 I am a person who does things legally and this is so shady how will I be able to file taxes if given neither? And am I an commissioned employee or an independent contractor?

  124. Ozzie says:

    So my bosses today decided to change my check from a 1099 to a w-2 without notice. Is this legal? I don’t agree with it and feel that there has to be something I can do.

    • 10 til 2 says:

      Ozzie: Do you know their rationale for changing your status? We can’t weigh in on the legality of it, as we are not attorneys; but if your employers realized that they had misclassified you and that you did not actually qualify as a contractor, they would probably be obligated to change your status to a W-2 employee. So it might be a good idea to ask them their reasoning behind their decision. Good luck and keep us posted.

  125. Subcont says:

    1st off, THANK YOU for keeping this blog running for so long and continuing to respond!

    I am currently a subcontractor but my boss has been mentioning the possibility of employee status as a choice recently but has not given any details, what do I ask? What should I compare to weigh out pros and cons? How do I go about finding the best option (subcontractor or employee) for me and my family?

  126. Jason Burks says:

    I am paid 1099. I receive a small set salary every month. When I sell something and I receive my commission check my company charges the B&O tax to my paycheck. I am in the State of Washington and sell a product my company stocks and retails. Can my company charge their B&O tax to as a cost to my deal? Seems weird I would be paying for their B&O tax doesn’t it? Please advise

  127. Deanna Wallace says:

    I am in a partnership. We have hired a third person to help us. We clean for a company that has 2 buildings. I clean one and my partner the other one. The third person mainly helps me at my building. I had a death in the family last week and she worked for me some days. Do I pay her out of my pocket or throught the business as a business expense?

    • 10til2 says:

      Deanna: We are not employment attorneys, so we strongly urge you speak to one or the Department of Labor in your state for professional advice. But, from our layman’s perspective, it sounds like your third person might likely be considered an employee in the eyes of Uncle Sam. Good luck.

  128. Lori says:

    I found out I was a 1099 employee when I started the job, now they have been taking money out of my paychecks due to not hitting a 100% to goal. I was told if I hit 80% it would be ok, they have taken 400 a week from my paycheck is this legal? I didn’t sign anything stated this and was not informed of this, they give a monthly number to hit in sales and now they are telling me it is a daily and weekly number. Just started and have proven myself until November was a low selling month, but in December I hit over 80%.

    • 10 til 2 says:

      Lori: While your situation certainly sounds frustrating, we are not in a position to answer your questions; we suggest you contact an employment attorney or the Department of Labor in your state. Good luck.

  129. James says:

    Man you’ve been asked a lot of questions and advice here. I hope you have room for one more. I’m in a bit of a pickle.

    My eyes have recently been opened to something regarding my employment and I guess I was naive for not noticing it before.

    I took a second job with my boss. It was presented to me as an extension of the work I already do. And it would supplement my income. Great! Or so I thought.

    Recently we had a shake up at my primary job and it became apparent to me that my extended job (2nd job) was actually an entirely separate company. My primary I get a w2 and my secondary I get a 1099. Both are almost the same job, too. One specializes in a particular service and the other is a general service. To top it off, with the knowledge I now have, I am entirely and utterly paid well below minimum wage for the 2nd job. And I work 40 hours a week, set schedule, all that.

    The primary company got bought out, which is 1 factor of what opened my eyes. And I’ve been having issues with the owner (old) and have been putting in applications at other places.

    I know you aren’t attorneys but do you think I have a leg to stand on, legally? Both in regards to the w2/1099 and my wanting to be able to obtain backwages? Is this something I can notify the IRS of and let them handle it or do I have to go face to face?

    • 10 til 2 says:

      James: Your situation sounds like a complicated one with many moving parts. We simply are not in the position to weigh in on your options except to suggest that you might want to start by calling the Department of Labor in your state. They might be able to provide you the guidance you need to move forward. Good luck and keep us posted.

  130. Anne says:

    I am a part-time server at a restaurant (I’ve been there for a little over a year) and I’ve just recently found out that my employer issues 1099s. I’ve NEVER had to do my taxes this way! I’ve ALWAYS gotten a W2. Now I’m freaking out because I have a toddler, and I’m backed up on bills, and I’m getting ready to become a full-time student again next week, and I was relying on getting my tax return!!! I have no clue what to expect from this or what to do.

    • 10 til 2 says:

      Anne: Did you fill out a W4 and an I9 when you accepted the position? Are all of the servers at the restaurant classified as contractors? Did they pull any taxes/FICA out of your paychecks? We ask these questions because it is difficult to understand why you just became aware of your employment status after more than a year at the restaurant. We recommend you contact an employment attorney (which we are not) or the Department of Labor in your state, as we feel you have a good cause for concern regarding misclassification. We also strongly suggest diligence regarding these issues at the onset of any future employment.

  131. Jason says:

    Hi there. Have a question? I work for a small componey. Work there for about 6 months. I just received my w2 and it says I only made $3300.00. Because the pay checks I been receiving for the last 4 months were not threw a payroll company. Was a check from the company I worked for..They did deducted taxes from them checks. Now I went and filed my (or tried) and I was short about $2,000.00 for the EIC. So we did not file. Went back to my componey and said my w2 was wrong. They told me that since they did not run it threw the payroal company before January it won’t show till next year. I did not agree that was fare. because was loosing out about 3,000.00 in taxes because I was not snuff for EIC.. So I quit, or tried.. The owner sad he will give me a 1099 form from the money I made that never went threw payroll. Witch in turn would let me be able to get the EIC for my taxes.. But where are the taxes going that I paid from them paychecks.. In his pocket (componey) So my question is should I go with this and loose about 800.00 to game 3000.00 from the EIC.. and can it come back on me with the IRS??

    • 10 til 2 says:

      Jason: Not sure that an employer can count you as both a 1099 contractor and an employee in the same year; but that is just conjecture on our part as we are not employment attorneys. We suggest you contact one or the Department of Labor in your state because this is sounding a little messy and you need to understand your options. Good luck and keep us posted.

  132. matt says:

    I am a 1099 personal trainer. I train my clients at a personal training studio. I do my own marketing for my clients as well. My question is…should my clients be paying me, or the studio owner. The owner currently has my clients paying her and signing her contracts.i receive a % Split from my clients (60% for me and 40% for the owner). I personally think I should be taking my clients payment and giving the owner her %. I also think that my clients should be signing my contracts. And if they are signing the owners contract, does that make my clients the business owners?

    • 10 til 2 says:

      Matt: There is a lot going on here and we are simply not in a position to give you any real advice, as we are not employment attorneys. The owner might be requiring the use of her contracts because she likely bears the burden of liability should something go south. Again, we suggest you speak to an employment attorney or the Department of Labor in your state. Good luck!

  133. matt says:

    Thanks for the reply.

  134. Bryan says:

    My wife is a preschool teacher at a church, which of course is tax exempt. There was never an agreement on what was going on with the tax situation after several attempts to find out what was being done, she was just told today she will receive a 1099 by the 31st. Is she then considered self employed and is that correct? They just asked for here SS and address information today. Will we now have to pay all the penalties for not filing quarterly? I read the “duck” portion of the article, some apply some do not, she has to turn in her hours bi-weekly and has someone to have to provide updates to and she did all the student recruitment, as her pay increases due to student enrollment, is she an employee or contractor? And what would be the best way to file?

    • 10 til 2 says:

      Bryan: Your comment proves an important point that we hope people will begin to embrace; it is vitally important that workers talk to their employers and understand the parameters of their positions, including employee/contractor status, prior to their first day on the job. Every employee needs to fill out W4 and I9 forms at the onset of employment; if a worker is not asked to complete these forms, chances are good that the employer either considers the worker a contractor or that the employer isn’t running its HR by the book (either knowingly or unknowingly). Here is a link to the IRS website that may be of some help: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-Self-Employed-or-Employee

      Please understand that we are not employment attorneys; we suggest you speak to one or the Department of Labor in your state. Good luck to you and your wife.

  135. tiffany says:

    My employer takes taxes out of my pay but instead of giving us w2s were getting 1099 is that legal.

    • 10 til 2 says:

      Tiffany: Doesn’t sound right. We suggest you speak to an employment attorney or the Department of Labor in your state ASAP. Best of luck to you.

  136. Angela says:

    I am considering working for a Canadian company, from my home in the US. I would be working as a 1099…know of any issues I could have there???

    • 10 til 2 says:

      Angela: We have no idea; we strongly suggest you contact the Department of Labor in your state. If they don’t know they answer to your question, they can likely direct you to someone who does. Best of luck to you.

  137. Monique says:

    I am a full time cosmetologist. I have Ben working at the same place for 3 years. When I first started working there they did payroll. I was on a three week leave and when returned they no longer did pay roll. I am commission paid only. They make the schedule pricing rules dress code and mandatory meeting but they refuse to do payroll which means my taxes aren’t coming out and it’s left to me to pay them and they are giving me a 1099 when I should be getting a w2 because technically I’m employed through them. Could you help me in how to address this matter??

    • 10 til 2 says:

      Monique: We are not employment attorneys and simply are not able to offer you the type of advice you need. We suggest you contact one or the Department of Labor in your state for some guidance. Good luck to you!

  138. Annie says:

    I started working with a small staffing company in Dec 2014. This is my first employment in the US so I wasn’t fully aware of types of employees. Anyway, i was seeking permanent fulltime position but it turns out that i am on 1099. My boss micromanages me, tells me not to have personal conversations or discuss salaries with colleagues, not to mingle with employees that are below my level and to inform him when i’m not on my desk.
    On top of that he’s not paying me an hourly rate as per 1099 but an annual compensation that is paid in equal monthly instalments on 7th of following month. If i take leave, he divides the monthy amount by no. of working days in that month and deducts the daily wage ( i have no leave entitlement for first 6 months)

    Is it mandatory to be paid an hourly rate on 1099, can he do what he’s doing? I calculated and there is a significant difference at the end of the month as per his calculation.

    Please advise. thanks.

    • 10 til 2 says:

      Annie: Here is an answer to one of your easier questions: 1099 rates do not need to be hourly. In regard to your more sticky questions, we are not saying that this staffing company is misclassifying you; however, we strongly urge you to contact an employment attorney or the Department of Labor in your state. It sounds to us like you have some very legitimate concerns. Best of luck to you and keep us posted.

  139. SteveP says:

    I am looking at a contract to hire position out of state. The contract term is 6 months and there is no relocation package. They assure me that at the end of the contract I will be a full time employee. During the contract term I will be required to meet the dress code and be in the office for set hours. How does a contract to hire position apply to the “duck” rule?

    • 10 til 2 says:

      SteveP: There are a lot of factors that may come into play; for instance, during your contract, are you being paid by the company or by a third party (like a staffing firm)? Your question is valid but beyond our wheelhouse. We suggest you contact an attorney familiar with both federal employment laws and those specific to the state of the company for which you will be working. Good luck.

  140. Melissa griffin says:

    I worked for a cleaning company for 2 years. When I was hired I was trained. Took lunch when our supervisor told us to. When I got my first check it said contract labor. I really didn’t understand and it was explained that no taxes were taken out. So I was just happy to have a job. And then we got real busy for a couple months lots of overtime. Only there was no overtime just straight pay. I continued to work blind to the laws. After a year I was made supervisor and received a raise. Had to train girls. And drive to and from jobs. My duty’s were already planned out by my boss. Every morning. We were trained a certain way to do a job and if the boss didn’t like it she would fire you. So you see none of us were contracted out. We were employees. And I want to put a stop to it. The lady’s work very hard and deserves their benefits and overtime.

  141. Anne B. says:

    I work as an office manager for 4 1/2 months at a photography studio. I was there everyday from 8:30 to 5. I filled out the form for taxes. They took out taxes on every paycheck (when they payed me) I received a 1099 yesterday and the owner said I was contract labor. Shouldn’t I receive a W-2 and not a 1099??

    • 10 til 2 says:

      Anne: To us, the fact that they had you complete a W4 would imply that you were brought on as a W2 employee, not a contractor (if they had you complete an I9, this would also imply employee status). Also, businesses do not withhold taxes from contractors. We are not employment attorneys so are unable to give you legal advice; we suggest you speak with one or the Department of Labor in your state. Good luck and keep us posted.

  142. KWG says:

    I am an independent contractor in the interior design field. I did some work for a couple in their home. I recently received a request from their accountant to send her a W- 9 form, which I did. I then received a 1099 from them but it was from their business and was overstated by about 20k. I did no work for their business and wasn’t told I would be working for a business they have. My work was for them personally and all my invoices to them were under their personal name and home address. They paid me with checks in their name. Can they legally do this and if so how can I correct this? Thank you.

    • 10 til 2 says:

      KWG: First and foremost, we are not attorneys and we urge you to speak with one should you need legal advice (or perhaps a tax accountant). But we can offer this. Maybe a well worded phone call to either the couple or their accountant explaining their egregious error, along with a request for a new 1099, might do the trick. We can’t imagine that you want to get stuck paying taxes on 20 grand you never received. Good luck and keep us posted.

  143. Shar says:

    I run a small business without employee’s. I am about to have my son work for me for 10 hours per week. He is not on a set schedule, he’s a student and is working around his class times. Can I issue him as a 1099? I’m confused. Is it illegal to 1099 a relative?

  144. Jill says:

    Hi, do you know the deadline/date an employer has for his accountant to give you your 1099 so you can do your taxes? I know Jan. 31 is the deadline for a w2 but the boss told me his accountant has until Feb. 15. It is Feb. 18 and I have still not received my 1099. The boss hasn’t answered my texts questioning this. Please do you know the deadline for emplyers to give their employees their 1099’s in the state of NJ? I had to already cancel my appt. with my own accountant. Thank you.

    • 10 til 2 says:

      Jill: We are not employment attorneys nor tax accountants, but according to this article on Forbes.com dated last year, the IRS requires businesses to to send contractors their 1099s by January 31st. The informative article is worth a read. Best of luck to you.

  145. Joe says:

    I was wondering if the company I me and my wife have been working at has been doing the 1099 right or if we should be W2. First of all I have been there 6yrs and wife has been there for 12yrs. They are telling us to be there at 7:30 every morning and what jobs to be at everyday and we have only worked for them everyday. If I try and go work for another company doing the same thing he threatens to fire me. He tells me what to do on every job. She is payed salary but 1099 every year and works from 8-3 everyday. I answer most of his customers phone calls and service calls and write his checks to pay for his materials.

    • 10 til 2 says:

      Joe: While we don’t know much about your work situation, there are so many red flags in what you said. We are not employment attorneys; we strongly suggest your speak to one or the Department of Labor in your state to help you determine your status and options. You and your wife have worked for this company for many, many years and we think your contractor status is definitely worth at least looking into further. You may also want to check out this page on the IRS website. Best of luck to you and please keep us posted.

  146. Alissa says:

    Hello. I work for a public school district and I am a licensed teacher. I was hired as a contract teacher and am given a 1099. I report to school and do almost all things that a salaried teacher does. I also pay into the state teacher retirement. In addition to paying the state retirement I also have to pay self employment tax. This appears to be double tax to me. Any thoughts on this matter? I am trying to become a W2 worker but then they would have to guarantee me a job year to year unlike now where I sign a new contract each year. Thank you.

    • 10 til 2 says:

      Alissa: Your comment is concerning, particularly on how it relates to your tax questions. We are not employment attorneys and can’t give advice on your situation other than to suggest you speak to an employment attorney. We do know that in the past the IRS has had some issues with public schools considering even their athletic coaches as contractors. We assume you are also part of a teachers’ union; perhaps they have someone who can help you figure out your situation and options. Good luck and keep us posted.

  147. Alissa says:

    Thank you. I am not part of the union so I am really on my own on trying to figure this out. No sick days, no personal days, docked pay on snow days, etc. I will try to talk to our superintendent and then off to the employment attorney I guess.

  148. Chris says:

    We contacted a lady who has ladies she sends to care for elderly or folks needing medical or home assistance. They say they are not contractors yet take a check from us or cash. It is a temporary thing taking care of our mom for a few weeks. She said they are home health assistants and are not 1099 contractors yet they do this for many people. I say they are 1099 folks – what says you?

    • 10 til 2 says:

      Chris: We have no idea what their status would be; but more importantly, you need to be sure that the health aides coming to your home are licensed and insured. If they truly are employees of “the lady” then she must be paying Workers’ Comp insurance; we are not employment attorneys so can’t advise only to say that if this were us, the insurance thing would be important. Good luck to you and your mama.

  149. Jim says:

    Ok I’ve read a good many of the questions here, and still have one or two of my own: I went to work for a company, part time, w-2, under these conditions, all work starts and ends in my home office, all costs are on me with the following exceptions: I could claim up to $40 a quarter for office expenses, and was reimbursed only .35 a mile for mileage but only from the first stop to the last stop. I set my own hours scheduled my own stops, but when each day was submitted for payment their system rearranged my stops to their own “optimized” schedule, AKA pay the least amount of miles and drive time possible. I had 4 pay rates, 14 an hour standard, 16.50 technical troubleshooting, 18 Supervisor, and 10 for the time they paid under their optimized plan for drive time. I have several red flags here, first off no benefits at all, it was work and get paid on a per stop basis, for a set amount, or not work, period. second I would spend at a minimum an hour before leaving in my office working on their work, and another hour in the evening uploading and closing my day. even though I am considered a w-2 employee, there is a lot here that indicates independent contractor, and from what I understand, it would be more financially beneficial to be able to declare my my work as such. Yes they did take out taxes, but my most obvious question would be which would be better in my case? another is can I deduct the difference in my standard pay rate of 14 and the modified pay rate of 10 when I was driving? This is not something that was made known to me or agreed to when I started with them. I know I can take off the difference in mileage reimbursement in either case as reimbursed employee expenses, or business expenses, but is there a difference in the amount I would get back? that is the biggest thing to me since I put on nearly 40K in miles last year, but using the standard government rate of .56 per mile they only covered about 40% of the miles. I really would like some sort of definitive answer since I can’t seem to really find one that nails my situation on the head…

    • 10 til 2 says:

      Jim: Unfortunately, you won’t find your definitive answer here. While it sounds like you have some legitimate concerns, we are not employment attorneys; we highly suggest you speak to one or contact the Department of Labor in your state. Best of luck to you.

  150. Sendy says:

    My husband is a real estate salesperson in Pennsylvania. He has been thinking about hiring somewhat of an assistant to organize paperwork, listings, and follow up with clients. He originally offered me the job since it is something that I’ve had extensive experience with and I can do most of the work on my own time. It would also eliminate the hassle of actually looking for the right candidate. Would he be able to hire me under a 1099 especially since we file jointly?

    • 10 til 2 says:

      Sendy: We are not sure. Sounds like a great question for your tax accountant or an employment attorney. Good luck to you and your husband!

  151. Lois says:

    I started as a CSR for a new insurance agency working from the agents home. I was set up as a 1099 independent contractor and was to make “20% commission on everything that walked through the door”. As the business grew and we needed help, he hired a part time receptionist @
    $10/hr and suddenly I was being paid 20% commission after expenses but he would insinuate that he would make me a partner, so I let that slide.
    A year later we moved to an office and he asked me to watch the office from 8:30 am to 4:30 pm Monday thru Friday. I had another part-time job at the time, which I was making $16/hr but through the recession my hours were cut to 9 to 12 hours / wk and I was making about $700/month, the agent asked me to quit that job and he would pay me the $700 to sit in his office and with the thought that I was a partner that was okay with me, however the expenses also went up and my 20% got smaller.

    We have now been in the office for 2 years and things aren’t moving the way they should have…he now says he doesn’t know where I got the idea that he would make me partner and so I started complaining about my pay, that if I’m not part owner why am I paying your expenses and why am I not getting an hourly wage for the office if I am your employee and not a partner.

    Needless to say I am now unemployed…I quit. I have been kicking around the idea that I should file a complaint with the labor board. Do you think I have a case?

    • 10 til 2 says:

      Lois: It sounds like you tried your best to make this all work and that is commendable. We are not attorneys so we are simply unable to give you legal advice or weigh in on the merits of a potential case. We wish you the best of luck though and we know that a great opportunity is out there just waiting for you. Keep us posted.

  152. Gail says:

    My fiance may take a job driving a truck that delivers equipment to the oil fields in ND and he will get a 1099 how often does he have to file the 1099 to the IRS ??

  153. Josh says:

    I have a question…?
    I have a small growing Janitorial company and want to 1099 someone, I typed up a contract stating the jobs that needed done and what to do. Gave them a starting and finish time.(only due to business opening for business). In the contract I stated the salary for every two weeks i would pay. and the days he/she would have off.
    Is this legal or do i need to w2 them? please help..

    • 10 til 2 says:

      Josh: Sounds to us like they are W2 employees; but we are not employment attorneys, so we suggest you speak with one or the Department of Labor in your state for the clarification you need. Best of luck to you and your business.

  154. Beth says:

    My husband is a W2 employee. His company will be issuing him a rather large bonus this year. The check will not come from payroll and will not have taxes taken out. Thus the bonus will fall under a 1099 situation. From what I have read, this is against IRS code. Am I correct in this?

    • 10 til 2 says:

      Beth: From how we understand it, with a few exceptions, employers cannot issue the same person both a 1099 and a W2 in the same year. Like we said, there are exceptions; for example a CPA who has a lawn service side business and as such picks up the mowing contract for his employer can be issued a W2 for his CPA work and a 1099 for his lawn contract. But a single person conducting his job in a consistent manner is likely solely considered a W2 employee. Please understand that we are not employment attorneys, so this is just conjecture on our part. We suggest you speak to an attorney or the Department of Labor in your state. Good luck to you and your hubby and congrats on that big bonus!

  155. Kris says:

    Hi I’m a company truck driver…I have a dispatch that tells me what to do …I drive company truck and I figure out on the bill of landings…still working on 1099…does company has to provide me with workers comp? And is it legal to work on 1099 in this case? Thank you

    • 10 til 2 says:

      Kris: We are not in a position to give you legal advice, as we are not attorneys. What we can tell you is this: When determining contractor/employee status, it boils down to the amount of control the company has over the worker. From the little bit of information you provided, you might want to look into this further. Misclassification can be very costly to workers in many ways, lack of workers’ comp being one of them. Here is a link to a lawyer’s website that offers some pretty in depth information on the topic (this firm happens to be based in CA; be sure to contact a lawyer in your own state should you choose to pursue this further). Best of luck to you and keep us posted.

  156. Michelle says:

    I’m trying to start my own consulting company directed to only dental offices. I wanted to know how I would classify myself in this position. I would basically be going in to their offices and evaluating their staff and make changes as needed to help increase production and collection. I would be teaching them how to conduct their offices and therefor would be working independently. It is safe for me to assume I would fall under the classification of a 1099 employee? Would it be any different if one or more offices hired me to do monthly monitoring over a long period of time?
    Thank you for your advice in advance!

    • 10 til 2 says:

      Michelle: The term 1099 employee is actually an oxymoron… one is either a w2 employee or a 1099 contractor. According to what you wrote, it sounds like you are a consultant and an independent contractor providing services to one or more businesses. At the end of the year, your clients will each send you a 1099-MISC form that discloses the amount they paid for your service during the prior calendar year; and that you will use to file your taxes. It sounds like you probably know all this; but we included it just in case! Please note that the answer listed here is simply conjecture on our part, as we are neither tax accountants nor employment attorneys. For professional advice, we suggest you speak to one or contact the Department of Labor in your state. Best of luck to you on your new business!

  157. Michelle says:

    Thank you very much for your advice, it’s much appreciated!

  158. James says:

    I have two jobs. One 1099 the other w2. Very complicated situation. But it’s remote technical support work. Do I still contact my own DOL if the boss is in another state? Or his states DOL?

    • 10 til 2 says:

      James: Your question is more complicated than it might seem. In all likeliness, the company for whom you do the support work needs to be licensed within your state in order for you to be a W2 employee. This might vary by state; so you should probably check on that. We suggest you start with the DOL in your state. They should be able to guide you to the info you seek. Please keep in mind that we are not employment attorneys and this reply is simply conjecture on our part. Best of luck to you.

  159. bludwurm says:

    I worked with a tower climbing company named Kirms Communications in West Palm Beach FL who paid by 1099. I never received a tax form. They set me up a Corporation and said that I didn’t have to worry about taxes, that I would just have to pay my-self nothing and I wouldn’t be taxed. I just found out that that they have been claiming that I made $90,000 dollars for years. Now the IRS is after me. Two years ago I lost that job because of a hand injury caused by the companies negligence. I still have pain and haven’t been able to hold a job. Now I owe the IRS about a hundred grand in back taxes and I don’t have a penny. I’m afraid to say anything about it to the anyone in charge because I am so broke and I don’t need them to come take my home. All the while Harry Kirms, the owner, is running around the Bahamas in his Yacht. What should I do? You can google the company. I’m also a single father. I could use anyhelp.

    • 10 til 2 says:

      bludwurm: We strongly suggest you contact a lawyer specializing in employment law. We are sure there are many in your city. Very best of luck to you.

  160. Bobbie says:

    I’ve been employed with my father’s roofing company since 2007. I receive my wages weekly and I am paid by the hour. In 2013 I suffered an injury as I slipped during a tear off. I injured my ankle but my father refused to call in a workers comp claim. Long story short I went back to work and my ankle never heeled properly and has developed a deformity and I’m unable to do any type of work, because I have trouble putting weight on it as it gives out. My father had given me a 1099 every year. And has now left me with thousands of $ in unpaid wages, and injury that has disabled me , and no current job because he would rather avoid these issues rather then try to fix them.

    • 10 til 2 says:

      Bobbie: If all of your father’s employees were filed as 1099, he probably never carried worker’s comp insurance and thus had no coverage for your injury. This is certainly purely conjecture on our part. You present a sad story and we wish we could give you some sort of guidance. Perhaps you should consider contacting an attorney to determine if you have any legal options. Best of luck to you.

  161. Trtlkss says:

    I am working as a trail guide (give guided public horseback trail rides). Currently I get paid days I work. I was recently approached about going full time with the company. However I would be 1099ed. I feel, as of right now, from the description between 1099 and W2, that I fall into both categories. Essentially I know my job and how to do it, well, without having to be told. However the owner still tells me what rides I will take out, when I will take them and how long they will be. I also use horses, tack (saddles etc), pitchforks, wheelbarrows, etc provided by the owner.
    How do I go about looking into whether or not I should be 1099 or W2?

    • 10 til 2 says:

      Trtlkss: Many times (although we are not necessarily implying this is the case here) businesses that engage workers in activities that bear physical risk opt to classify these workers as contractors to avoid paying a premium in workers comp insurance. Workers in high risk jobs who are classified (mistakenly or otherwise) as contractors will likely be solely responsible for any injuries they might incur while on the job. So, God forbid, you get kicked in the kneecap by a rogue horse, not only will you likely have to cover your own medical expenses, but also might not be entitled to disability. Our point here is that contractor status is serious stuff that can affect many aspects of your life (not just your tax responsibility) so it is important to speak to an employment attorney (which we are not) or consider contacting the Department of Labor in your state to determine if you are being classified correctly. Good luck to you and keep us posted!

  162. Betty Briggs says:

    My husband was asked to fill out app for a trucking company the first thing they told him was 1099 is this good or bad can someone please give us some advice thank you.

    • 10 til 2 says:

      Betty: If they are classifying him correctly than it is fine; if they are misclassifying him, then it is not so good. Contractor classification is not really determined at the discretion of the employer. We suggest you check out this page on the IRS website that may help you determine whether your husband is being classified correctly. Please understand that we are not employment attorneys; you might consider contacting one or the Department of Labor in your state. Good luck to you and your husband.

  163. James says:

    Hi. I work for a suburban taxi company in California, of which I was classified as an independent contractor. But they completely micromanage every drivers move, always telling us where we had to be and where we had to go, telling us we had to give notice about taking time off or even quitting. They did so very forcefully in a bullying fashion! Under the strongest determining factor by the IRS of control and behavior, it is without question that they are in violation of missclassifying their drivers. They also blame the drivers-even if partly sometimes – over accidents and mishaps to avoid going to their insurance. Drivers you need to keep their jobs are often disgruntled. What can be done?

    • 10 til 2 says:

      James: Your question is way beyond our wheelhouse. We urge you to contact the Department of Labor in your state; hopefully they can help you fully vet your options. Best of luck to you and keep us posted.

  164. James says:

    Thank you. I already found the contact info for, specifically, the local CA Bureau of Field Enforcement – the branch of the CA Labor Dept. which would deal with this. It’s just awful – they reprimand us when we don’t tell them where we are at every point, etc., etc., and decide when we can have a ‘day off’ commensurate to their situation.

  165. Vicki says:

    I am currently working as a receptionist at a used car lot in a very small town my employer and I have agreed on a set amount of pay but he is not with holding taxes and will give me a 1099 at the end of the year will this work or does he have to w2 me as the business is very small and does not have alot of revenue.

    • 10 til 2 says:

      Vicki: Neither the amount of money you are paid or the amount of revenue generated by the business are factored in to whether you are an employee or a 1099 contractor. Because your employer is not withholding taxes, you are responsible for more of your tax burden than you would as an employee (and also would not likely be covered by workers comp should you be injured on the job). You might consider contacting the Department of Labor in your state or visiting the IRS website for more information. Good luck to you.

  166. Linda James says:

    I have worked for one month as a Virtual Executive Assistant for a small filming production company. As of this date, have not received any wages nor other virtual staff.

    Employer is now saying it was recommended to him by a bank to pay us all $2,000 on a 1099, then pay the balance which will include taxes by either direct deposit or check. Is this legal? I’m confused. Thanks for your reply.

    • 10 til 2 says:

      Linda: We are not attorneys so are unable to give legal advice. We can tell you that it sounds a little suspect in our opinion. We suggest you speak to a lawyer or contact the Department of Labor in your state. Best of luck to you.

  167. Steph says:

    I was a w2 employee as a sales consultant. While I was employed by this company I was actively pursuing a carrerr in law enforcement, which my employer found out about. They gave me a choice to resign or get fired due to this job, so I resigned to avoid having that negative mark on my record. That was over 45 days ago and I still have not received my commissions from contracts I generated. Their response is that the jobs must be completed for me to get paid. They have attempted to send out other sales members to “resign” the contract so they will get the commission rather than me. I was under the impression in California once I resign that my employer has 72 hours to pay my commissions earned, even if that means prior to the installation (such as a roof) and if the employer has exceed that time frame they owe me a “daily wage” until they pay me in full. Am I correct?

    • 10 til 2 says:

      Steph: We are not employment attorneys so we are simply unable to weigh in on the legality of your situation or give you legal advice. What we can suggest though is that you contact the California Department of Labor; hopefully they can point you in the right direction. Keep us posted and good luck!

  168. Mason says:

    My boss told me that since it was a seasonal job that it was alright to put us as independent contractors even though I get paid an hourly wage, don’t set my own hours and receive a regular check every week. Is this true?

  169. […] same. According to 10 til 2, a staffing company, the difference between the two has to do with expertise and job purpose. You hire a contractor for a specific job or project through a contract. They are not required to […]

  170. Rosa says:

    I’ve been working for a company that contracts to a big tech company. It’ll be 4 years Nov 1st that I’ve been with this company. When i first started i was W2 but transitioned to 1099 about a year and half ago. Reason i transitioned over was due to my vendor paying me a salary and taking 13% off the top of my salary then sending what was left to payroll to then have the same amount taken out again. Here is how it is worded in my contract in past:
    x company would like to pay Rosa $5655 as W2 salary employee.
    This $5655 equates to $6500 cost to x company since x company pays 13% ($845) to WA state on behalf of Rosa: matching her S/S, M/C, Federal Unemployment, State Unemployment and industrial insurance. In other words in order to pay Rosa $5655 W2 monthly x company pays $6500 in cost for Rosa. In either case Rosa makes $6500 monthly/78,000 annually.

    Is this even legal? Seems unethical to me and hence why i switched to 1099 but will have to switch back to W2 Jan 2016 due to all the changes happening with vendors and this big tech company.

    • 10 til 2 says:

      Rosa: We can’t even begin to weigh in on this. We suggest you contact the Department of Labor in your state. Hopefully they can help. Best of luck to you!

  171. Jamie says:

    I work for a franchise of a large company as a salesperson in Ohio. They have me as a W2 employee even though I am paid only on commissions earned. For the first 6 weeks I was paid a starting salary but that is now gone and I only earn money based on my sales. They require that I be available for 40hrs a week and also require that I submit for time off as needed. I am required to man the retail store they have 1-2 days a week without any compensation. They do provide me leads which is how I make my sales. I am required to drive to a company sales 1 time per month which is a 2:15hr drive each way. They do allow me to take as many or as few appointments as I like.
    I should really be a 1099 based on all this but they have me as W2. What could be there reason? Do not like them trying to control my off time.
    Please advise. Thanks!!

    • 10 til 2 says:

      Jamie: We are not employment attorneys so we are in no position to speculate or advise. The good news is that because you are considered an employee, you are covered by workers comp should you be injured on the job; and the company pays a portion of your tax burden. If you consult an attorney or the Department of Labor in your state regarding your questions, you might want to check on those unpaid retail store hours; we are not sure, but that could be an issue. Best of luck to you.

  172. Mary says:

    I have a company LLC and want to hire an employee, what do I need to change? this is a Georgia company.

    • 10 til 2 says:

      Mary: We suggest you contact the Georgia Department of Labor; they should be able to help you. Best of luck to your expanding business!

  173. Nick o says:

    Yes I currently work for a painting company I belive I should be 1099 but there are a few things my boss does. He makes me drive my personal car to work and doesn’t reimburse me for fuel and I don’t know if he needs todo so also he never lets us go on a lunch and if we do and he comes to the job site he gets all pissed

  174. traci says:

    I am starting a Nanny Agency. I have not hired anyone as of yet. Basically it will be a as needed glorified babysitting company. Im trying to get insurance, which seems to be impossible. Would there be a difference in getting insurance if I were to say these employees are 1099? ex. A family calls me because they want a date night, I call up someone I hired and tell them to go to so and so house. The family pays me then I pay the nanny

    • 10 til 2 says:

      Traci: We are not employment attorneys nor employment insurance experts. We can tell you that for businesses like yours, very good insurance is probably both necessary and quite costly. And we suggest you engage a very good background check company. Good luck and keep us posted!

  175. Jim says:

    one of the questions mentions the term CONTRACT EMPLOYEE. Having worked for many engineering companies
    this term has come to mean for as long as we have the contract.

    There is no law preventing you from being an employee
    there is no misclassification

    We hire and pay our temporary help as employee. even if the work is fixing the roof on our building. It costs more to do it this way, but we find it safer and everybody is usually happy.

    Under audit by NYS Department of labor, a 1099 can only be issued if the individual is in business holding himself out to the public, Provides his own supplies, bears the risk of loss,
    is not supervised by the payer
    does the work on his schedule and at his own pace. Then he /she can be considered an independent contractor and the risk of reclassification is greatly reduced.

  176. David says:

    A lot of states now have misclassification units to investigate these types of complaints or answer questions. They are usually through their labor, workforce development, or unemployment insurance tax divisions. I highly encourage anyone with these types of questions to search their state for these units and contact them. You can also look at the IRS 20 factors when trying to determine if you are a independent contractor or an employee. Just google IRS 20 factors. Also look at this webpage by the IRS: https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-Self-Employed-or-Employee

    • 10 til 2 says:

      Great link. Thank you, David. We have suggested readers with questions contact the Department of Labor in their state on nearly every post; but your link most definitely saves some elbow grease. Thanks again.

  177. James says:

    Hi everyone. I received a response from the California Dept. of Labor regarding my contention with a suburban taxi company which classifies its drivers as ‘independent contractors’ yet micromanages the work shifts of the drivers in a hour-by-hour controlling manner. They even get very ornery when one doesn’t do ‘what they say’ regarding ‘instructions’ of ‘assignments’, etc.

    The CA Labor Dept. explained,

    “…Just to explain, individuals who are “independent contractors” are not considered employees for wage and hour purposes. There is no single definitive factor in determining whether an individual is an independent contractor or an employee for purposes of wage and hour laws. An individual will be considered an employee where the employer exercises all necessary control by direct or indirect means over the work details of the individual…”

    It’s a no brainier! There’s no ambiguities there whatsoever. But I can’t help but wonder why they might think they are above reproach. I mean, it’s so blatant how they violate the stated rules.

    Thank you, James

  178. James says:

    It gets better: the CA Labor Dept. responded again to a subsequent comment if mine:

    “We are happy to assist.

    Please assist the Division of Labor Standards Enforcement by filing a report of labor law violation with our Bureau of Field Enforcement (BOFE) to request an investigation of Orinda Taxi LLC by downloading the claim form and following the directions provided at: http://www.dir.ca.gov/dlse/HowToFileBOFEClaim.htm

    You can request that your name not be used if you wish…”

    This was very edifying to read. I’ll decide soon how to go about this. The taxi company may be unsavory jerks, but it’s not like they’re some drug ring or something. Sites like thus have been helpful, too.

    Thanks, James

  179. Anuj says:

    I am working as an independent contractor in one of the company through a recruiter / job consultant in Houston. I am a contract on 1099 with recruiter and going daily to the client site in Houston.

    Now recruiter is depositing money into my account bi-weekly and not deducting any tax.
    But as I asked them to give me the pay slip/paystub, they replied that the person who is on 1099, no pay slip or paystub is given. Is it true? What other document do I have from recruiter for future reference ?

    • 10 til 2 Central says:

      Anuj: This might be worthy of a little more digging on your part. The recruiter is correct that contractors generally don’t get pay stubs; but most 1099 contractors send invoices for the work they perform rather than having deposits made by the client (which in this case would be the recruiter) directly into their bank accounts. Please understand that we are not employment attorneys and are unable to give you advice. You may want to contact the Texas Department of Labor for the clarification you seek. Best of luck to you.

  180. Anuj says:

    Thanks Central.

  181. Michael C says:

    Long story short: I was approached by a competitor who offered me 12% above my current pay with all the same amenities plus less daily driving. I told them I needed to think about it, no problem they said. I then went to my boss whom owns the company and a week later with the added info to him I was about to leave to go to our competitor, he called me and offered me 15% above my current pay if I would stay with him. Well of course I did stay, only to have him tell me that I would need to put the extra pay difference on my weekly expense report under misc. until the addition to my hourly rate could be changed in the payroll side of the company. By the end of the phone call he says, “Wait a minute Mike, I wont have to pay more for my insurance (unemployment?) if I don’t show an increase in my weekly payroll by you just continuing weekly to put the extra pay in misc. and you(me) will get more than 15% by doing so”, I didn’t like it from the git go and told him I would rather not put my extra pay on my expense report, but he assured me this was a way better way to go than any other way for the both of us. hmmm! that was 6 months ago, practically right away I lost my perdiem and was instructed by him to drive on company time to and from jobs in zone pay area and so I did as instructed. Now its gotten worse and with more lies from him, he has terminated my employment trying to make me look like I had falsified my hours. In the meantime he had made stricter rules regarding daily time entry via phone to be turned in daily by 4:30 without infractions placed upon all employees for not doing so. He hires office personel from a temp agency and doesn’t get the best of help, which their performance is worsened by his constant bitching to everyone within ear shots distance I see big trouble for him and possibly me for believing he was doing me right. What to do? He is also with holding my tools and pay from me that I need… HELP

    • 10 til 2 Central says:

      Michael: We are not attorneys. We suggest you speak to one to determine your options (or you may want to start with the Department of Labor in your state). Pretty sure that the withholding pay thing is a big no-no though. Keep us posted and best of luck to you!

  182. James says:

    Hello again. I’m very curious if it can be somewhat determined, if the Labor Dept. investigates a company for alleged worker misclassification (in my case they do so demonstrably!), does the investigating branch go further than merely taking the company’s word that they follow the rules? I’ve been a little affected by some of my friends and acquaintances telling me it’s my word against theirs. I mean, if the tykes are blatantly being violated, I would think that cannot be concealed under investigative scrutiny.

    Thanks, James

  183. samantha garcia says:

    Hi, I am very very confused on all this 1099 deal.. I was on a W2 for 6 months with my current employer, I work for an Insurance Agency as a CSR, for personal reasons i had to move out of the country and my employer offered me to work over the phone still as a CSR but now on a 1099, I do not know anything about 1099 employees so i said yes because i was happy i was going to keep my job. I bought my computer, printer, headphones, copy paper, I bought all i was going to need to work from home AND now i got my hours cut, now i work 25 hours a week with a pay of $200 dollars a week, less than 10,000 a year..I still respond to my boss with reports at the end of the day and reports on all that ive done in the 5 hours i work on the phone everyday.. With all ive read here iam scared i might be paying uncle sam more than what im being paid..I need to know if its worth it or not, because i have not read any good things about a 1099, and also i have not signed anything from my employer saying im now on 1099, is that ok? If i still report to my boss as if i was still in the office, i clock in and out everyday, can i request to stay on W2? Or is that a choice only my employer makes? please any advice is greatly appreciated.Thank You sooooooo much.

    • 10 til 2 Central says:

      Samantha: While it is impossible for us to weigh in on the specifics you mentioned, we can tell you this: Your status as an employee versus contractor relies less on your employer’s “choice” and more on the nature of the work and how you perform it. Also, we are not sure what state you live in, but it sounds like you are getting about $8/hour. Be sure that you are not earning less than the minimum wage in your state. You might consider contacting the Department of Labor in your state for a better understanding of your situation and options. Best of luck to you.

  184. SwaggerMate says:

    I work on a 1099 I hold a street sign for advertising a insurance company I am being micromanaged I am told when to take a break and when not to take a break and I am NOT at the spot they want me to be when they drive by I am to lose the whole days of pay or told if I do not do my job as required I will be asked to leave the company I don’t know much about a 1099 but was wondering if this was a violation of a 1099 for Florida.

    • 10 til 2 Central says:

      SwaggerMate: We have no idea. But consider this. If your left foot is tragically run over by a car while you are spinning that sign, as a 1099 contractor, you are likely entitled to no workers comp and will have to foot the entire medical bill yourself (sorry about the pun). We suggest you contact the Florida Department of Labor; hopefully they can help you understand if you are being properly categorized as an independent contractor. Best of luck to you and keep us posted.

  185. Kim says:

    My mother employer let me barrow some money when I was down on my luck. He made me sign a contract that I would work off what I owe him at his business. He would pay me 8 an hour, half goes in my pocket and the other half to what I owe. I only work maybe 1 week out of 2 1/2 months. Now he tells me the third week in December that he is taking a 1099 out on me, and I’ve not even finished working off what I owe. He didn’t tell me till then he would be doing that, or I wouldn’t of worked for him. I feel he’s taking advantage of me. Can he legally do that?

    • 10 til 2 Central says:

      Kim: We are not attorneys so we are not in a position to give legal advice. But we can tell you this. Your mother’s employer sounds like a really nice guy who did you a huge favor. That is all we got.

  186. LGF says:

    My daughter is a dog groomer. She does not work for herself. She did some side work for the dentist I work for. She went to his house, picked up his 3 dogs, groomed them, and returned them home. This was done probably 8 times last year. She was mostly paid in cash, but twice she was paid with a personal check and once with a company check. My boss is trying to give my daughter a 1099. She would never have agreed to do this side work if she thought she’d been given a 1099. Now she’ll have to pay taxes on this money that she had not saved for. I’m not sure how he can work this angle thru his business. This is personal pets—they sure are not part of the dental office!

    • 10 til 2 Central says:

      LGF: It might seem like a raw deal for your daughter, but if she is old enough to work she is old enough to know that the IRS requires individuals to report all income regardless of whether they are 1099 contractors or just doing a side job for a friend. It is simple. You make money; you report it. Whether it is a legitimate business expense is between the dentist and Uncle Sam. Best of luck to you and your daughter.

  187. Donna says:

    I am a nanny, sharing the work load with my 2 daughters. The couple (employers) that we work for have paid us cash (under the table), not reported to the IRS (not claimed as neither W-2 nor 1099). Employers want to begin the new year reporting to the IRS (so, I’m assuming this is better for them, as they probably have to report where all their money is going that they pay us for childcare). They asked if we prefer W-2 or 1099. I have no idea! What do you think is best for us, the employees?

    • 10 til 2 Central says:

      Donna: We are not employment attorneys or income tax professionals so we are not in a position to weigh in on your question. But you should know that in the eyes of Uncle Sam, there is no such thing as “under the table” employment; the government expects (and requires) people to report all income. You might consider contacting the Department of Labor in your state; they might have the answers you seek. Best of luck to you and your daughters.

  188. Rebecca says:

    My husband is a truck driver and he has been an independent contractor before with a 1099. In that instance he was paying for his truck, all equipment associated with his duties,paid for own fuel, booked his own loads and worked when he wanted.In August he went,to work with a small 5 truck company who made him sign a contract as a 1099 with 75% revenue of all loads delivered. He was suppose to be able to reject any load he wanted and have a 30 day written notice of terminated or quit. The owner paid him only 25% of the revenue, booked his loads for him so he drove when and where they told him to.He was also told by email that the new dispatcher they hired in was his boss and He had to go where she told him to. That doesn’t sound to me like an independent contractor in any way whatsoever. He wasn’t allowed to work for anyone else while operating for these people either. He never actually paid any leasing monies for the equipment, fuel or anything else. They also didn’t pay him for his last week of work. I have filed the ss8 form with the IRS but haven’t heard back from them yet. We also reported to the labor and wage dept because we feel that he was in fact a w2 employee and not a contractor. Your opinion? Also can they report the income that they never paid him? He never got a pay stub from these people ever….it was cash deposited into a savings account of their choosing. They live in Wisconsin and I live in Alabama so I’m not even sure what states I need to claim taxes on.

    • 10 til 2 Central says:

      Rebecca: Wow. It sounds like you are going through the proper channels to get this figured out and remedied. We are not employment attorneys or tax accountants so we are unable to offer you any expertise. But we can tell you this. 1099 contractors generally do not have bosses, they have clients (and those clients have very little bearing on the way the contractor does business). Out two cents. Best of luck to you and your husband.

  189. James says:

    Ok I don’t understand this at all, but ok I’m doing security for a business that the owner hired me to watch over his business over night and he (owner) wants me to be here at the exact time at 8:30pm to 5:30am. I can’t show up late. He’s paying me $50.00 a night to sit here at his business. When I first started I wasn’t mentioned that I would get a 1099. I was told that it was $50.00 a night and it was cash only, but I’m being paid from his business check. My understanding is that I’m labeled as a contractor labor. the state I’m from is Alabama. If anyone can help what do I need to do.

    • 10 til 2 Central says:

      James: Here is the deal that many people simply don’t understand. In the eyes of Uncle Sam, there is no such thing as “under the table” employment. If you are on someone’s payroll as a W4 worker, then you are an employee. If you earn money outside of an employer-employee relationship, regardless of whether you are officially labeled a 1099 contractor or not, you are required to report that income when filing your taxes each year. So those people who are shocked that a company wants to give them a 1099 for work they performed and for which they were paid need to educate themselves on their tax obligations. We are not employment attorneys or accountants so we are not in a position to give you advice, but really the only thing it sounds like you need to do is be sure to claim that income when you file your taxes. Best of luck to you.

  190. Lily says:

    I was working for an independent State Farm agent who paid me with w2 my commissions and salary. I switched jobs to another agent and he pays me my salary with w2 and my commission with a 1099. When I saw my new accountant he said to tell him to pay me with w2 and that he is doing fraud and he left it at that and did not want to go in further.. Can anyone explain to me please how this affects me?? And what is my new boss doing?

    • 10 til 2 Central says:

      Lily: We are not tax accountants nor employment attorneys, so we are not in a position to give you professional advice. We can say that we are not entirely certain that an entity using a single EIN (Employer Identification Number) is allowed to pay an individual both as an employee and as a contractor for the same position. It is hard to say why your employer is doing what he is doing, but he bears no tax burden on the 1099 wages he pays you. Again, this is all purely speculation on our part; for a definitive answer to your questions, we urge you to contact an employment attorney or the Department of Labor in your state. Best of luck to you and keep us posted.

  191. Irina M. says:

    Here is my question: I get 1099 from the A Co I do accounting for. I have opened my own S Corp and I redirect my paychecks from A Co to my S Corp. Respectively I write myself a check from S Corp, but a little less. So my question is, do I issue a W2 to myself from my S Corp? Or I just use 1099 to file my taxes. Thanks!

  192. joseph says:

    my question: I work with 1099 in this company. My job is open door for installation crew around 6:30 am Monday thru Friday and some Saturdays. My job is also coordinate installers with daily schedule. Then I train sales people , hire also fire by request of owner. I take control of office people with schedule and with customer service issues. then end of day I close the door to go home. I’m wondering my 1099 qualifies to the kind of work that I’m doing now?

    • 10 til 2 Central says:

      Joseph: It is hard to speculate; and we are not employment attorneys or income tax specialists. But we can tell you this: Many companies that act as contractors sometimes mistakenly consider their employees as contractors as well. Check out this post about just this very thing. We suggest you look into this further. Best of luck to you.

  193. Gladys says:

    I work in a daycare where im told that i should be there by 8 and leave at 4
    My boss tells me what to do!! Everything goes by her rules
    Sounds like im a W2 employee
    But im being paid in a 1099
    And im not earning over 25000 a year
    I ask my boss to pay me in. W2 but says that her business is small and cant afford it
    That its very expensive for her

    • 10 til 2 Central says:

      Gladys: We are not employment attorneys or tax specialists; you should contact a professional for expertise and advice. We can’t tell you whether you are an employee or contractor, but we can tell you this: The size of a business has little or nothing to do in determining whether its workers are contractors or employees. Yes, employees are more expensive to a business than contractors (employers need to pay employment tax, workers comp insurance, unemployment tax, etc. on employees but not on contractors). Say you get injured on the job, as a contractor you in all likeliness are not covered by any workers comp insurance; and you are also essentially covering the cost of what your employer is saving in employment tax. It might be worth looking into further. Good luck to you and keep us posted.

  194. mike says:

    have a building cleaning service with two employees that help clean the building are they considered employees or can I have them as a 1099 independent contractor

  195. Dr. A says:

    I recall reading an article some time ago that the number of hours worked a week also plays into it. For example you can’t be a contractor working 40 hours a week, every week. But not sure if there are other factors.

    Any opinion ?

    • 10 til 2 Central says:

      Dr. A: We actually believe that it is possible for a contractor to work for a single client for 40 hours per week for a sustained amount of time; however, that 40 hour, nine-to-five work week could also potentially be a red flag for worker misclassification. You see, one of the criteria for being an independent contractor is that the person offers their services to multiple clients. A 40 hour work week, sustained over a long period of time, might suggest more of an employer-employee relationship, as the worker has no opportunity to sell his services elsewhere. A 40-hour work week isn’t the end-all in determining 1099 misclassification, but it certainly might trigger a closer look in the eyes of Uncle Sam. Please note, we are not employment attorneys nor tax professionals; for expert advice on the subject of 1099 rules, we suggest you speak to one or contact the Department of Labor in your state.

  196. Mary says:

    I work off and on at a Florist as a floral designer for the holidays. Most times I work a week or 2 at a time. The supervisor sets my start time and sometimes my end time unless I want to leave early. I provide my own tools but they provide all supplies. I am to make flower arrangements as directed by the manager often times similar to a photo or her example. So far they have paid me as a 1099 worker but recently they asked me to sign a paper stating I am an independent contractor. After reading about the differences between employee and contractor I am now thinking I am a temp or seasonal employee. What do you think?

    • 10 til 2 Central says:

      Mary: We are not certain, but if we were to bet, we would agree with you on the seasonal employee thing. We are not employment attorneys; for expert advice we suggest you speak to one or contact the Department of Labor in your state. Best of luck to you!

  197. Nick says:

    I am currently an employee but my position is ending this friday. I have formed an LLC and will implement an ERP program for my former employer. This will be a long term consulting position. I was originally hired without a definitive position. Several months later the need for an ERP system was warranted. Forming my own company is not only financially logical for me but also for my former employer. I have read that this is the trend but the IRS is of course doing everything possible to still call me a W2 employee. Reality is that I am 100% on my own with this project. ERP software and hardware has been purchased and I am the sole driving force behind implementing. I can come and go as I please but i will be working many hours per week to go live with our system in 6-9 months. Should i be concerned about being labeled a W2 employee because this one job is going to be full time and then much more each and every week. Just looking for any advice or maybe from someone else in a similar position.

  198. Dan says:

    I work in an office during night shift. 12 hours a day, 3 or 4 days a week. I don’t get paid overtime. My boss deposits my salary into a savings account. He first made me sign for a W2 but he also made me sign a form standing I work as a independent contractor. He doesn’t pay taxes for me. I’m confused, I am supposed to get the 1099 form if I am not wrong right?

  199. Terri says:

    Hi. I am a truck driver. My boss owns the truck and I just drive it. The truck company pays him and he pays me. I have no check stub per say and I never get to see how much the load is that he got paid on. He has not given me my 1099. I filed an extension and it is now September 1st and I have one month to file. He has still not given me my 1099 and will not return my calls. What do you suggest I do. Should I ask the bank for a copy of all last years direct deposits and just assume? Thanks so much Terri.

  200. Chance says:

    I am an employee and my company allows me to come and go as I please and I am classified as a 1099 employee. Where my question lies, (as I would be text book 1099 employee) should this said company dictate my lead flow based off of when I show up, how long my lunch or breaks are, or when I leave? If for any reason I do. It abide by their rules my income will be affected, even if it is a justified reason…. essentially I am forced to comply to their rules even being 1099 or my income will be greatly sacrificed for a long period of time. Could you please shed some light on what grey areas can and can not be crossed while being 1099?

  201. Charles messer says:

    I have a ? I work for a mobile home park i have two bosses below the owner i show up at 9 leave at five they say im 24 hour on call i live at the perk he pays my bills and give me a check for 700 on the 1 of every mouth abd 1099 me some time i work 50 to 60 hour a week should i sue the owner i use the parks tool and they tell me how to do the job

    • 10 til 2 Central says:

      Charles: Different states have different rules for jobs like yours. You are probably best served contacting the Department of Labor in your state to get the clarification you seek.

  202. Author Support Coop says:

    If someone does work for you and you paid them well but didn’t get their SS#, and now the person is angry because the project is over and so is their generous income, how can you submit a 1099? Can you do it without a SS#?

  203. Sara says:

    I am a bookkeeper that took on a client in 2011 that did not have an office so I have always worked from my home office. He did not want to pay payroll taxes on myself and my daughter who also works as a bookkeeper with me so he has always 1099’ed my business as independent contractors but we are both over 40 hrs a week with his company. both of us have positions with the company and emails etc. Does this make my client or myself liable for misclassification of employment?

  204. Barbara Milligan says:

    I own a courier company. I have a full time W-2 employee. I have 5 part-time retirees who are on-call when we need them. They have the choice to accept or decline the job when called and I then move on to the next one. Some weeks they may work, the next, they may not. They are all listed as drivers on my commercial auto policy. They are self-governed. I give them the pick up and drop off information and they choose their route and time to leave for the job, when to stop for lunch, how to load the truck. They fill out their own delivery ticket. I pay them by the hour. They provide their own GPS, own cell phone, own work clothes. Some have also worked for other companies at the same time they work for us. I issue them a 1099 at the end of the year. Are they employees or independent contractors?

  205. Vanessa says:

    Hi there,
    I’m a dog groomer and my employer wants to switch us to 1099. I’ve heard other groomers are not particularly fond of this meathod because most employers don’t follow the rules. I’m clear now on they can’t set a specific time of when I come and go but can they ask or require me to do things around their shop? (Daily weekly cleaning tasks that usually gets divided among the staff) I’m also aware that I will no longer be covered under workers comp, but is there any other major differences that I’m not aware of? So far I’m not seeing too many benefits to being 1099. A bit of back story on this was we were presented with the option of seeing staying w2 but going down 40% commission or switching to 1099 in order to help them make more money. So I’m already on alert feeling like I’m getting the rug pulled out from under me.

  206. Vanessa says:

    Hi, another thought on the dog groomer question. Someone told me that for 1099 you have to get your own business license. Is this true?

  207. Stacy says:

    Hi there, I work for a company where I am 1099. This company tells me when to clock in and out, tells me when to go on breaks. I have to attend weekly mandatory office meetings, but work from home. I have to call out for my shift and get points or possible termination. When i go into the office i have to adhere to a dresscode. I am concerned i am misclassified, but unsure. My time is recorded every day. On average i work 14 to 16 hour days? Am i misclassified? How can i find out without losing my job? What should i do? My company says they can tell us anything we are just 1099 for tax purposes. Please help!!?

  208. Johni says:

    I am the manager in training at a tanning salon and I am 1099. I am paid $5.50 an hour plus commision on the lotions they give us to sell. I have never sold enough lotion to make minimum wage either.
    We are required to clean the beds after client’s tan, sweep and mop the floors, washm dry amd fold laundry, make bank deposits in my own vehicle, write out the weekly schedule for the 4 of us who work here and open and close the salon. Am I really a 1099 candidate?

  209. Kitos1986 says:

    Hello I am a maintenance worker I was previously employed by a property management company they chose not to continue their employment with the property I was at which is owned by the housing authority of the county I work in the county didn’t want to go without a maintenance worker so they offered me a contract as a 1099 employee the thing is they told me that I needed to work no less than seven no more than 8 hours in any given day was told I could work a minimum of 35 maximum of 40 hours a week they provide all the materials I’m technically there for time I am the only maintenance man so they are dependent upon me and now they’re trying to have me perform duties that are outside the scope of my work described in my contract wondering if I should do them and wondering if I’m being misclassified

  210. Rose says:

    I’ve worked as a 1099 for years. However, as of recently I’ve been working for a spa that takes the payments, has a schedule I have to keep, takes 60% and one place even charges rent on top of that. My question, I just quit and asked to get paid right away. She told me I have to wait until the 6th when the payroll is cut. By law do I have to wait to get paid for services I’ve already given which they have been paid for deposited in their account?

    Please help me understand. It seems more and more people are taking advantage of contractors and the money we bring their business.

    Thank you

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