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Reply to Is this Situation 1099 or W-2?     
Old 08-08-2017, 05:17 PM   #11
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
What state? If CA then 100% W-2. It is really based on the state because the state is the only one that will audit them. It is 1099 till the "employee" complains to someone or the employer gets caught.
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Old 08-08-2017, 06:23 PM   #12
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Bevo on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
Originally Posted by somarco View Post
It is my understanding there are agents today, working in offices where they take the application but the GA is listed as the WA. The GA is invited to award ceremonies, presented plaques and goes on fancy trips.

He takes the kudo's while the grunts do the heavy lifting.

In this case it's W-2 all day long until the cows come home. But at this point the GA has already taken that much from them, why stop now and pay part of their taxes for them?

And there are probably too many agencies out here doing that to even count.
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Old 08-08-2017, 07:11 PM   #13
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adjusterjack on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
Originally Posted by VolAgent View Post
It depends on the level of control.

https://www.irs.gov/businesses/small...ed-or-employee

They are definitely providing tools. How much control does the GA have?
A worker can ask the IRS to officially determine whether the worker is an independent contractor or employee by filing form SS-8 available at the above link.


And there's this:

American Family's 1099 Losing Battle and Industry Effect
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Last edited by adjusterjack; 08-08-2017 at 07:27 PM.
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Old 08-09-2017, 08:44 AM   #14
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VolAgent on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
Originally Posted by adjusterjack View Post
A worker can ask the IRS to officially determine whether the worker is an independent contractor or employee by filing form SS-8 available at the above link.


And there's this:

American Family's 1099 Losing Battle and Industry Effect
Yep.

Although it always doesn't go well for the 1099 either. I don't know if they ever backed down on this, but at one time the IRS would also send all the new W-2 employees a tax bill. They would go back and disallow all those Schedule C deductions since they were no longer sole-proprietors, but W-2 employees. If they had made any money, it generally caused a large tax bill.

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Old 08-09-2017, 12:02 PM   #15
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somarco on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2? somarco is the thread starter for: Is this Situation 1099 or W-2?

DOL audits are increasing and many times it is the DOL that will uncover and address the issue.

The Other Audits for Employers - Barbara Weltman

https://www.datamaticsinc.com/the-lo...e-irs-and-dol/

And yes, Kirby is right on the possible tax audit of the former 1099 employee. Should get a refund on SE taxes but could owe more income taxes once the business write offs are denied.

I had a client several years ago that was trying to qualify for a DI policy. Gross income just shy of $300k. Net after business expenses $20k.

He drove a bread truck for a local bakery, delivering to grocery and convenience stores. Actually BOUGHT the bread at wholesale then marked up and sold to stores. Packages were pre-priced for retail. His truck. His gas. His maintenance. His inventory.

I don't know why he didn't get a regular job. Required him to get up at oh-dark-thirty and deliver. Back home in time to take the kids to school.

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Old 08-09-2017, 09:13 PM   #16
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xrac on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
My thought is because of the industry they can get away with calling it a 1099 if they so chooose.

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Last edited by xrac; 08-09-2017 at 10:24 PM.
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Old 08-09-2017, 11:54 PM   #17
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
IRS code outlines a list of questions that would determine a W-2 agent. That said, if you signed a contract with the GA, it's possible that you are a 1099. Read the contract. If no contract, then follow the IRS questions to determine your W-2. I know some GA's have solicitors working in their office. As a Solicitor, you're still a 1099 but all your commissions and any renewals are assigned to the GA.
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Old 08-10-2017, 08:19 AM   #18
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VolAgent on Is this Situation 1099 or W-2?
 
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Is this Situation 1099 or W-2? Re: Is this Situation 1099 or W-2?
Originally Posted by roygbiv View Post
IRS code outlines a list of questions that would determine a W-2 agent. That said, if you signed a contract with the GA, it's possible that you are a 1099. Read the contract. If no contract, then follow the IRS questions to determine your W-2. I know some GA's have solicitors working in their office. As a Solicitor, you're still a 1099 but all your commissions and any renewals are assigned to the GA.
Contract does not trump law. In every situation I am aware of, there was a contract stating the people were 1099. However the DOL and IRS ruled otherwise and that is what matters.

Many contracts literally are not worth the paper they are written on. But they do scare people and stop a lot of lawsuits.

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