Q. Our company is hiring temporary workers for a big upcoming job. Do we have to treat them as employees? M.T.K., Brooklyn, N.Y.
A. Maybe. Whether or not you can treat workers as independent contractors, rather than employees, depends on your level of control, not temporary or permanent status. Assuming a temp worker earns more than $600 and is classified as an employee, you must withhold employment taxes on the wages just as your company does for other employees.
Tip: If the IRS reclassifies workers as employees, you could get hit with additional taxes, penalties and interest.
Online resource: Download our free white paper, Independent Contractor or Employee? How to Make the Call at www.smallbixtax.net. Click on Resources.
- How to Fire an Employee the Legal Way: 6 Termination Guidelines
- Small Business Tax Deduction Strategies
- Nonitemizers earn no charity write-off
- Financial security is millennials' benefits focus
- Boost business deductions with a charitable-gift program
- What's the law on hiring a private eye to check for workers' comp fraud?