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    3 Replies Latest reply on Jun 18, 2010 1:17 PM by cutcomp

    Can I hire contractors to work for me if I'm an s corp?

    Mrtrim Newbie
      I've been in buisness for 5 years now as a trim carpenter and I have done all my work through one guy who pays me a check every week he has several other guys too.
      Anyway I no longer work with this guy and have just landed a big job in a couple of months so I now need to have guys working for me, can I do this with an s corp also the guy I used to work for always complained about paying out for some kind of insurance to have several guys working for him I don't know what this could be for. He also made us sign a form every year to say that we were workers comp exempt
      please can someone help
        • Re: Can I hire contractors to work for me if I'm an s corp?
          wdywft77 Wayfarer
          Call the IRS, believe it or not; they are super friendly and will help you out with lots of stuff.
          You can probably 1099 your contract workers...
          • Re: Can I hire contractors to work for me if I'm an s corp?
            Bridge Navigator
            As a S-copr. you can hire either employess or independent contractors.

            Regradless, if your company takes a "job" you will probably want insurance for liabilty purposes. Chheck with your insurance agent to identify the right type of insurance and if both employees and independent contractos are covered.

            Get the assistance of a good CPA to discuss with you the differences of IC versus employees and which one is bet for your situtaion.

            • Re: Can I hire contractors to work for me if I'm an s corp?
              cutcomp Wayfarer
              You can certainly hire contractors to work for you. You'll need to get a form W-9 from them and you'll need to report payments to them on a form 1099. As regards Workers Compensation, your former boss may (but I stress may) have been leading you astray. In most states, an uninsured subcontractor or independent contractor gets treated the same as an employee for Workers Comp purposes--that is, if you're injured or otherwise harmed while doing work for someone who hired you as an independent contractor, you are entitled to the same statutory benefits as a regular W-2 type worker. And you can't waive that, no matter what you sign.

              However, a relative handful of states have enacted some limitations to this in recent years, so that a real and true independent contractor can register with the state and opt out of the WC system. But there are significant restrictions in these states regarding the availability of this opt out, to prevent abuses. So you would need to check carefully what the rules are in your state. Your best source for this information would be the state agency in charge of adjudicating disputed Workers Compensation claims.

              We maintain on online guide to Workers Compensation insurance, at that covers these kinds of subjects. You might find it a useful resource.

              So it may well be that, in your state, you will be responsible for Workers Comp coverage for any independents you utilize. To make sure you are compliance with your state statutes, you need to do some careful research about what the rules are in your state, and any other states you might be operating in.