Thanks Brian, It can be a bit confusing in determining the definition of a contractor. In Googling State information, I came across 20 different questions/guidelines to try to determine whether someone is classified as an employee or contractor. What makes it more confusing is that some producers hire "crews" to thin their peaches and classify them as contractors.
Either way, I've decided to hire the teens as employees, not contractors, for the temporary help I need, based on all the good advice on this listserv. I already fill out a 943 and W2 for my son, who helps me. Mark Angermayer Tubby Fruits Peach Orchard Bucyrus KS On 4/11/15, Brian Heatherington <beechcreekfa...@earthlink.net> wrote: > Mark, > > From the perspective of the IRS and SSA, as soon as you pay and > individual $150 in any given year, you need to match FICA, Medicaire, > with hold taxes, and file a 943 + W2's each year. If you consider them > contractors, you will have to 1099 each one, or you can have a > potentially large cash labor expense on your Schedule F. This can be a > trigger for an audit, although many people get away with it. > > The problem is, if you give a high school kid cash payment, a 1099 at > the end of the year, are they going to have the cash put away to pay > their taxes at the first of next year? If they have a W2, they can do > their taxes in 10 minutes online, and possibly get a refund. Not > necessarily so with a 1099 and a self employed status. In my opinion, > it's best to go ahead and set up EFTPS and be legal. A bonus to this is > that the IRS will see your business as legitimate, even if you are > showing some losses in the early years. Especially if you are a hard > working fruit grower.... > > State laws vary widely. In Georgia, agricultural employers are not > required to with hold state taxes or have workman's comp. There are > other employee injury/liability riders that can be added to ag insurance > policies to cover your "assets" at a lower cost. Companies such as > Westfield in Ohio offer such policies, along with product liability, > farmer's market policies, etc. The rider is basically enough to cover > emergency room visits and make you held harmless in case of accident. Of > course it is best to give comprehensive training to avoid worker injury, > which also tends to negate the independent contractor status. Ladder > falls are always a possibility. > > Of course, I'm not an attorney, and I definitely don't want to be one...... > > > Brian Heatherington > Beech Creek Farms and Orchards > 2011 Georgia Highway 120 > Tallapoosa, GA 30176 > > > > On 4/9/2015 11:01 AM, Mark & Helen Angermayer wrote: >> I plan to hire some high school kids to help me thin fruit this year. >> They will only be working for about a month it takes to thin the >> fruit. >> >> I'm uncertain if this temporary employment would fall under employees >> or contract labor. I've looked at the definitions, but still unclear. >> >> Some of the requirements of contract labor vs. employees are who >> provides tools, and who defines work schedule. Obviously there are no >> tools required for fruit thinning, other than one's hands. I intend >> be flexible on when the kids can work, so am not setting work times. >> The kids would be hired individually, not as a "thinning crew". >> >> The dollar cost is the same to me either way (because I plan on paying >> more for contract labor and less for employees) but the paperwork is >> less for contract labor. I'm a very small commercial grower, so FUTA >> is not a consideration. >> >> Any help would be appreciated. >> >> Mark Angermayer >> Tubby Fruits Peach Orchard >> _______________________________________________ >> apple-crop mailing list >> apple-crop@virtualorchard.net >> http://virtualorchard.net/mailman/listinfo/apple-crop >> >> >> >> -- >> > _______________________________________________ > apple-crop mailing list > apple-crop@virtualorchard.net > http://virtualorchard.net/mailman/listinfo/apple-crop > _______________________________________________ apple-crop mailing list apple-crop@virtualorchard.net http://virtualorchard.net/mailman/listinfo/apple-crop
