# Accounting for Day Labor



## thom (Nov 3, 2006)

write them a check than cash it for them on the spot. 

That covers them for workmens compensation providing you appropriately report it. 

As long as a guy gets less than $600/year you are good with the IRS. State licensing might go after you but that is extremely unlikely.

If it's over $600/ year you are obligated to provide a 1099. Your tax return requires you to check if you should have filed 1099's and if you did. If you don't:

The Penalty-Trap: The basic penalty for not filing forms 1099 is generally $50 per unfiled return. This penalty, however, increases to the greater of $100 per return or 10 percent of the total amount that should have been reported if the IRS believes the failure was due to intentionally disregarding 1099 reporting rules. And herein lays the penalty-trap: If a business affirmatively states that they were required to file forms 1099 but fails to do so, they have intentionally disregarded the 1099 reporting rules. If, on the other hand, the business states that they were not required to file Form 1099 and it is later shown that they were, the business has intentionally disregarded the 1099 reporting rules and lied on its tax return.


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## Calidecks (Nov 19, 2011)

thom said:


> write them a check than cash it for them on the spot. That covers them for workmens compensation providing you appropriately report it. As long as a guy gets less than $600/year you are good with the IRS. State licensing might go after you but that is extremely unlikely. If it's over $600/ year you are obligated to provide a 1099. Your tax return requires you to check if you should have filed 1099's and if you did. If you don't: The Penalty-Trap: The basic penalty for not filing forms 1099 is generally $50 per unfiled return. This penalty, however, increases to the greater of $100 per return or 10 percent of the total amount that should have been reported if the IRS believes the failure was due to intentionally disregarding 1099 reporting rules. And herein lays the penalty-trap: If a business affirmatively states that they were required to file forms 1099 but fails to do so, they have intentionally disregarded the 1099 reporting rules. If, on the other hand, the business states that they were not required to file Form 1099 and it is later shown that they were, the business has intentionally disregarded the 1099 reporting rules and lied on its tax return.


 What if I went through all my books and honestly missed a subs 1099?


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## ranteso (Nov 11, 2010)

I just love how the so called "Professional" contractor eats it up when a home owner hires a "Non-Pro" contractor and experiences a problem. We just laugh and giggle and say "Ha ha ha, you get what you pay for" 

Yet the so called "Professional" contractor has the audacity to seek advice on legal and accounting issues on a forum full of sea lawyers and accountants.

Ha ha ha, you get what you pay for


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## Calidecks (Nov 19, 2011)

ranteso said:


> I just love how the so called "Professional" contractor eats it up when a home owner hires a "Non-Pro" contractor and experiences a problem. We just laugh and giggle and say "Ha ha ha, you get what you pay for" Yet the so called "Professional" contractor has the audacity to seek advice on legal and accounting issues on a forum full of sea lawyers and accountants. Ha ha ha, you get what you pay for


That's why I have a bookkeeper that I don't let do my taxes. She cleans up my mess and my accountant cleans up any mistake she may make. It's a checks and balance system that works pretty good for me.


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## instock (Nov 17, 2012)

ranteso said:


> I just love how the so called "Professional" contractor eats it up when a home owner hires a "Non-Pro" contractor and experiences a problem. We just laugh and giggle and say "Ha ha ha, you get what you pay for"
> 
> Yet the so called "Professional" contractor has the audacity to seek advice on legal and accounting issues on a forum full of sea lawyers and accountants.
> 
> Ha ha ha, you get what you pay for


Are you talking to me? I am the furthest thing from a professional contractor! I have no idea what I'm doing half the time. I make this up as I go along. Check out my post in the Introductions forum. 

According to your logic, I should hire a professional chief executive to run my little handyman business. :no: According to your logic, the entire "Business" forum should not exist.  That's silly. 

I think asking a lot of questions, experimenting, and sorting out the good ideas from the junk are at the very core of running a business! The folks on here are a tremendous resource. :clap: They have done this before. Why on Earth would I NOT ask them???

BTW, I contacted Clover Resource. They sound perfect, but they have not followed through. Now, even if I do get set up with them, I wonder how responsive they will be when I want to add an employee. Not sure where to go from here.


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## Willy1959 (Mar 27, 2009)

Years ago I had a Son that was going thru a lot of medical, and although I still had to put food on the table and pay the bills, I just didnt have it in me to do the paper work of payroll. I had 2 guys that I wanted to keep, and I struck a deal with a Local temp agency to do just what one poster suggested. The agency charged me 140% of what ever my Mans wage was. They covered all the BS and even gave my guys a few more vacation days then I did when it was on my books. Sounded like a perfect solution. Problem came in with my main guy, he felt embarrassment working for a temp agency. Effing whiner lol Ultimately I let him go, he was too much drama about EVERYTHING, too bad because he was a decent hand. Good ole David now 20 years later has a beer with me now and again and tells me how much I taught him, how much he respects what I tried to do for him, and he wishes he was so immature at the time to realize that he had a guy trying to take care of him. lol oh well...


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## Pearce Services (Nov 21, 2005)

instock said:


> BTW, I contacted Clover Resource. They sound perfect, but they have not followed through. Now, even if I do get set up with them, I wonder how responsive they will be when I want to add an employee. Not sure where to go from here.


I used a local rep for them, I think you would do well to ask for a local agent. They can walk you through the process, and help with filling out the paperwork


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