Re: [tips_and_tricks] accountant situation
- i worked for a company as a machinist in 1994 that had the same problem, they found a loop hole.they created a temp empolyee employment agency llc which was soley held by the partent company after they got the structuring done they fired all the factory workers the temp llc hired them the next hour and signed them to a contract and leased them back to the parent company. the workers kept the same benifits aand did not lose one days pay in the process. but the fees and insurence costs went from 93k/month to 9k / month for the parent company. the only thing they had to do was post a sign under new management
rocketmankennyknappcom <rocketman@...> wrote:I would like input from group members regarding this situation.
We have a C corp. Under this C corporation we have a seasonal
business in Colorado. For the last several years, the people who work
with us did not want us to take taxes out. We did not send them
1099s. Our accountant put the money we paid them in an "outside
services" category. Now, our accountant is saying we must start
taking taxes out. If not income taxes, then FICA and unemployment
I have some good ideas on how to deal with the accountant, but I would
like to hear from members for their input. I think the accountant is
more worried about raising flags with the State than the Feds. We
don't want to end up going to court to defend not withholding taxes
from people who didn't want us to withhold taxes from them! We
believe these people are workers, not "employees."
- First off your responsibility is to the Corporation which has agreed to abide by the Administrative Laws, UCC, etc., for the privilege of being a non flesh and blood person (Corporation), and is not to it's employee's wishes or desires to not pay income tax on their paychecks. If they do not want to be classified as an employee they can set themselves up as a Sub Chapter S Corp and bill you Corp. with an Invoice for the work that they do. They will need to provide you with a W9, workmen's compensation Insurance, Public Liab. Insurance. Your Corporation will need a written agreement with each Sub Corp that does work for your corporation stating that the contract is perpetual based upon a X amount of dollars per job broken down to X amount of Dollars per hour or a fraction thereof.This allows each person to take over a thousand deduction as a S Corp. vs. minimal deductions as an employee and minimizes their tax payments to the IRS, if they want to pay or not is then their choice. This gets your Corporation out of the way of harm and let's the people who should be fighting the battle of IRS stealing from their paychecks, in the battle.OR, you could go out to WWW.Givemeliberty.org and down load the workers forms and they can fill them out and file them with your corporation. Then you send copies of these to the IRS and ask them what to do. Of course they are going to tell you to take out taxes anyway, then you write a letter back and ask the IRS if they are going to defend or compensate your corporation for the legal and other cost associated from following their demands to withholding, when your corporation is sued by it's employees. Of course they will not and they will tell you it is the LAW, and lie a little more here and there, putting your corporation in the middle of a battle that is not your concern, remember your their to ensure the corporation makes money and it's stock holders if you have any, and the corporation runs according to the by-laws. Be sure to hold your directors meetings and issue out resolutions or your not a Corporation you are an individual and the corporation veil that protects it's directors can be pierced, and directors held accountable personally.I do not like this anymore than anyone else that is aware of the IRS stealing money out of employee's paychecks but, I am not willing to go to prison like Dick Simkanan (spelling may not be correct), loose everything I've worked for in temporary passage of life here on this planet, because employee's want me to fight their battles for them. This issue has been going on for over 10 years that I am aware of and I have not seen anyone win this battle, there are no silver bullets in this area. I like my employee's and I certainly do not like to see them work that hard just to have their fruits stolen, so I do what I can but there is very little that can be done, and it is no compensation to watch a family with children struggle to provide for their needs, because the IRS is stealing that amount necessary to overcome poverty and live free and whole in life. They say charity starts as home, so we have a charity fund in our corporation. We hold directors meetings and issue out resolutions as to our charity gifts, to employee's that have just had babies such as diapers, baby food, clothes, and a food bank closet for larger families, and the Denver Rescue Mission, but charity starts at home and a corporation is home to alot of good hard working folks, that make the corporation what it is so it can afford to help. At the end of the day it is you looking in the mirror and you have to judge yourself accordingly as to being your brothers keeper.This is the best I can offer as a suggestion.Scott WilliamsDenver, Colorado