Contracting work

[Wimblees@AOL.COM]

In a message dated 5/5/99 1:32:27 PM !!!First Boot!!!, prescottpiano@juno.com 
writes:

<< Has anyone experience with this kind of situation? How does one keep an
 independent contractor status without falling afoul of the IRS?
 
 Larry Messerly RPT >>


There are two ways you can do this. 

1. You give the names of the customer to the person doing the work. He 
contact the customer and collects his fee. At the end of the week, he gives 
you a check for x number of dollars as a "commission". (Obviously this needs 
to be an agreed amount, either a percentage of the fee he collects, or a set 
fee for each customer). He keeps record of that, and if the total amount of 
commission is more than $600, at the end of the year he needs to send you a 
1099. He record his income and pays taxes on it. You report your income from 
and pay taxes on it. No other paper work is required. 

2. You  have the customer make out the check to you, and you give him a 
"commission" (again, an agreed upon amount). Then you keep track of all of 
that, and send him a 1099 if you pay him more than $600.

There is no problem with this. The IRS allows employers to use outside labor, 
and call it contract labor, as long as the outside laborer uses his/her own 
tools, and doesn't spend too much time at the place of employment. So you are 
obviously in the clear there. 

Good luck with the operation. 

See you in KC

Willem