Payroll

[stringblade]

Im going to have one employee this year ive never had an employee on the books. but i was wondering what to do get a pay roll company to take care of all the dedutions for about 80$ a month or should i attempt to due this myself. 80$ seems kind of steep but thats the cheapest i could find.

what do you guys do with only one employee? thanks

[Stephen M.]

Keep the money and pay yourself the $80, it will take less than 30 minutes to do the payroll stuff each time. It's not as hard as it looks. Or pay your signifcant other the money so they can go shopping.

[Phillip Baker]

1099

I 1099 my guys so they are responsible for thier taxes. Is anyone else doing this?

[Stephen M.]

you better be careful with the sub contractor designation. If you control the work hours and how they do their job, then they are employees and subject to payroll taxes. I know a few guys in my area who went out of business after the state and feds caught onto the scam. Alot of guys try to avoid payroll taxes by making their employees "sub contractors". The IRS will spot check and audit for fraudulent independent contractors and they use a 20 point common law test:
1. NO INSTRUCTIONS: contractors can't be given or required to follow your instructions.
2. NO TRAINING: contractors rarely recieve training to perform a task.
3. SERVICE CAN BE RENDERED BY OTHERS: can your "sub contractors" hire others to do their work? [sweet, different faces everyday with no boss control! A workers paradise].
4. [Their] WORK NOT ESSENTIAL TO THE COMPANY.
5. OWN WORK HOURS: do your "sub contractors" set their own work hours or do you?
6. RELATIONSHIP WITH EMPLOYER: most contractors don't have a day to day relationship with their employers.
7. CONTROL OF ASSISTANTS: can your "sub contractors: hire, supervise, and pay assistants independent of you?
8. TIME TO PURSUE OTHER WORK: do your "sub contractors" persue other work. In other words, be in competition against you?
9. JOB LOCATION: the contractor decides when and where work is done. [Gee boss, I'm not going to do that account today, it's raining.]
10. ORDER OF WORK SET: the contractor has control of the sequence of tasks that led to finishing the job.
11. NO PROGRESS REPORTS are required to be submitted to the contractor.
12. PAID FOR THE JOB, NOT TIME SPENT DOING THE JOB.
13. WORKING FOR MULTIPLE FIRMS.
14. BUSINESS EXPENSE: In most cases, contractors are responsible for their own job related expenses.
15. OWN TOOLS: contractors furnish their own tools.
16. SIGNIFICANT INVESTMENT: contractors invest heavily in their own trade at significant levels.
17. SERVICES ARE AVAILABLE TO THE PUBLIC.
18. POTENTIAL FOR PROFIT AND LOSS.
19. CONTRACTORS CANNOT BE FIRED SO LONG AS THEY PRODUCE RESULTS AS SPECIFIED BY THEIR CONTRACT.
20. NO COMPENSATION FOR NON COMPLETION.

[sharp]

get the payroll service, but pay every 2 weeks this will save you 30% in payroll service fees, the payroll service is one of the best moves we have made.

[stringblade]

thanks for the advice, I would like to just do it my self but im very impatient.
although i did find an online company called paycycle they will do all the calculations for 20$ a month the only thing they wont do is the state fillings.
they are susposed to be for the smaller companies. but i really dont like the idea of my bank account info on the internet. (my identity has already been stolen once)

[allyardcare]

This year I bought Microsoft Money 2004 Small Business. Included in the purchase is a free trial with a payroll company. After the trial I think they charge $9 plus 99 cents per employee. I'll research this a little more and get the exact numbers for you if you want.

[toby]

http://www.paychex.com/# - here is a link to a reasonable payroll company that will do payroll and all of your tax filings for you. You can get a quote on their website, but you don't have to do your payroll over the internet.

[sharp]

we use paychex

[The landscaper]

How much does it cost to use paychex for the whole year for you guys?

[Smokeeater 38]

How many of these do you need to have before your considered to be an employee?

you better be careful with the sub contractor designation. If you control the work hours and how they do their job, then they are employees and subject to payroll taxes. I know a few guys in my area who went out of business after the state and feds caught onto the scam. Alot of guys try to avoid payroll taxes by making their employees "sub contractors". The IRS will spot check and audit for fraudulent independent contractors and they use a 20 point common law test:
1. NO INSTRUCTIONS: contractors can't be given or required to follow your instructions.
2. NO TRAINING: contractors rarely recieve training to perform a task.
3. SERVICE CAN BE RENDERED BY OTHERS: can your "sub contractors" hire others to do their work? [sweet, different faces everyday with no boss control! A workers paradise].
4. [Their] WORK NOT ESSENTIAL TO THE COMPANY.
5. OWN WORK HOURS: do your "sub contractors" set their own work hours or do you?
6. RELATIONSHIP WITH EMPLOYER: most contractors don't have a day to day relationship with their employers.
7. CONTROL OF ASSISTANTS: can your "sub contractors: hire, supervise, and pay assistants independent of you?
8. TIME TO PURSUE OTHER WORK: do your "sub contractors" persue other work. In other words, be in competition against you?
9. JOB LOCATION: the contractor decides when and where work is done. [Gee boss, I'm not going to do that account today, it's raining.]
10. ORDER OF WORK SET: the contractor has control of the sequence of tasks that led to finishing the job.
11. NO PROGRESS REPORTS are required to be submitted to the contractor.
12. PAID FOR THE JOB, NOT TIME SPENT DOING THE JOB.
13. WORKING FOR MULTIPLE FIRMS.
14. BUSINESS EXPENSE: In most cases, contractors are responsible for their own job related expenses.
15. OWN TOOLS: contractors furnish their own tools.
16. SIGNIFICANT INVESTMENT: contractors invest heavily in their own trade at significant levels.
17. SERVICES ARE AVAILABLE TO THE PUBLIC.
18. POTENTIAL FOR PROFIT AND LOSS.
19. CONTRACTORS CANNOT BE FIRED SO LONG AS THEY PRODUCE RESULTS AS SPECIFIED BY THEIR CONTRACT.
20. NO COMPENSATION FOR NON COMPLETION.

[Stephen M.]

If you answer yes to only one, u have an employee. There has to be 20 NOs to be considered an independent contractor.

[sharp]

it varies how often you write pay checks and how many, really not bad around $25+ per pay day