Is this fraud?

caliotter3 · Apr 17, 2010

"we don't record any of your income for tax purposes". Quite certainly this is fraud. How is this employer paying taxes on your income then?

Anne36, LPN · Apr 17, 2010

They will let you work under the table?

Some people do it , but I wouldnt want to be caught.

Poi Dog · Apr 17, 2010

I did not sign up with this company. They sound shady.

mappers · Apr 17, 2010

MosIt may not be fraud, but it is certainly illegal. Even if you are an indepedent contractor, the company sends you a 1099 a the end of the year and reports the amount of money you earned from them to the IRS. I know. I worked for a temp agency for several years and did payroll. And to be considered an independent contractor, you have to meet certain requirements. Most temp jobs don't meet those requirements and payroll taxes need to be withheld. Either all the employees are contractors, or none of them are. There is no picking or choosing who is and who isn't.

Either this company has a very ignorant owner or they are shady to begin with. I wouldn't trust them.

Baloney Amputation, BSN, LPN, RN · Apr 17, 2010

If they want to claim their aides are independent contractors, they better not have been dictating to the independent contractors when to work or how to work unless they want a big back tax problem coming to bite them in the butt.

Anne36, LPN · Apr 17, 2010

If they are commiting fraud, then why would they have you sign a document to verify that?

Go and ask your tax preparer, mabye there is something here that is being missed.

greenfiremajick · Apr 17, 2010

If a company emails me with this, is this a form of fraud?
Also I forgot to ask you if your getting any type of other income because sometimes our aides collect unemployment or something else and they dont want to pay more taxes or get their benefits cut off so they ask us if we can pay them cash so we have an Independent contractor form for them to sign just stating that they dont want any benefits from our company, we dont record any of your income for tax purposes so you'll get straight cash and dont have to worry about taxes, or do you want to be on payroll then I can email you the W-4 forms. Let me know.
The bolded is what bothers me. Help, please.
Would this be considered a kickback?

You would have to look this up to verify, but I BELIEVE that as an independent contractor, YOU are responsible for reporting and dealing with income/taxes.

greenfiremajick · Apr 17, 2010

If they want to claim their aides are independent contractors, they better not have been dictating to the independent contractors when to work or how to work unless they want a big back tax problem coming to bite them in the butt.

OOOOHHH yeah.............

Whispera, MSN, RN · Apr 17, 2010

Yes, if you work as an independent contractor, and have signed that you are one, and get a 1099, YOU are required to report that income and pay taxes on it. I think that employer just doesn't want to go to the bother of sending your taxes in each payday. If you can put aside the tax money every payday and not spend it, it could be a good deal for you, but you WILL have to pay it eventually.

caliotter3 · Apr 17, 2010

Estimated taxes are due to the IRS every quarter and there are penalties for not being paid up on an ongoing basis. Something for independent contractors to keep in mind. However, it is not kosher for an employer to have some employees independent contractors while others are employees when these employees all do the same job in the same manner. The IRS has readily available information for the taxpayer to read on this subject. What it boils down to, is that most people are classified as employees rather than independent contractors as far as the IRS rules go.

netglow, ASN, RN · Apr 17, 2010

What Whispera and Caliotter3 said.

I have had my own business in the past for over 10 years (no employees). Yes you would be tax responsible if your income is over a certain set amount. irs.gov (1040-ES)

OP, if you plan on possibly working for any length of time I'd want to be on payroll. How many employees do they have? You certainly want to receive unemployment insurance if you should need it.