Statutory Employee Essay

When an independent contractor earns compensation for providing services or doing work and is classified as a self-employed individual rather than an employee, this is considered to be independent contractor income. This type of income will listed on Form 1099-MISC, which is where other types of income is listed.

IRS (2011) Employee vs. Independent Contractor – Seven Tips for Business Owners. http://www.irs.gov/newsroom/article/0,,id=173423,00.html Last accessed January 3, 2012.

Payroll taxes first appeared numerous years ago and have since evolved, grown, and underwent major changes. Payroll taxes are taxes that are paid by employers and their employees. Payroll taxes are collected by the federal, state, and local governments to fund certain programs or projects. The employee’s tax proportion is typically deducted from the employee’s wages every earning period, and the employer fraction of the payroll taxes are paid directly by the employer and are based upon their employee’s wages. The amount of payroll taxes that must be paid are required to be reported to the Internal Revenue Service and the employer’s state and local taxing agencies. Smaller businesses tend to lean towards independent contractors because the business is not required to pay taxes for independent contractors. Independent contractors are considered self- employed and are responsible for the employee as well as the employer portion of payroll taxes.

Organizations require many different kinds of skills and people. In addition to managers, knowledge workers (such as engineers, architects, or scientists) design products or services, and data workers (such as secretaries, bookkeepers, or clerks) process the organization’s paperwork. Production or service workers (such as machinist, assemblers or packers) actually produce the products or service of the organization.

It would be unusual to classify outside sales persons as self-employed, unless they were already established and self-employed businesses, and actually only had retail partner agreements.

2. Determine which framework you would use to assess your own employees, why you would use it and how it would differentiate employees.

The purpose of this document is to present and discuss the strengths, pitfalls, and underlying assumptions of differentiating employees in the manner suggested in Jack Welch’s framework. The document will also present a framework I would use to assess my employees, why I will use it, and how it will be used to differentiate them. Finally, this document will discuss the values, cultural elements, and organizational processes that must be in place for differentiation of employees to be equitable and productive.

According to what I researched off of the Internal Revenue Service, self employment tax only refers to social security and medicare tax. It is inputted on a Schedule SE when doing the tax return. Salaried earners who get a W-2 have their employer figure out their social security and medicare tax. So that means that one who is self employed they get to deduct the employer portion of the self employed tax on their adjusted gross income. The tax is also based off of 92.35 of their net earnings. I do not believe that these two items give a self employed person that much more of a tax advantage than the person who earns a w-2. The self employed person has to work hard to keep their business going and growing. They have

Both the salaried and self employed individual must have been employed or in business for a minimum of 2

LLc are considered self-employed and self-employment taxes are paid in contributions to medical care and social security. Plus, the entire net income of LLC is subject to this tax.

Self-employed IVAs are very similar to normal Individual Voluntary Arrangements. They follow the same principle – but the application process is a little different, as they have to accommodate your business and cash-flow.

Independent contractors are hired and used for various reasons by companies. Probably one of the main reason businesses hire independent contractors is that it will save the company money in the long run. Independent contractors are not employees of the company for which they are hired. They are ultimately hired to perform a service or provide a good for a fee. The definition of a contractor,

Would you rather be self-employed or work for someone else? A person who is self-employed is an individual that works for him or herself instead of working for an employer that pays salary or wages. The individual is known as the primary or sole operator that earns their income through conducting profitable operations from their business. There are a lot of key factors to consider when deciding to become self-employed; personality traits and lifestyle choices are a few amongst many.

A sole proprietorship is an unincorporated business with only one owner. If James chooses to select this option his role as the owner of the business would mean that the business would be considered the same legal entity as him.

Self-employed – According to Gov.uk (2015), self –employed people are defined as individuals who are in business for themselves and provide a service to multiple clients. They have far greater control over how and when to deliver the service and who delivers it. They will usually be better able to protect their own commercial interests, although they will bear any financial risk from the business they operate.