Employees on the books

So I am to the point where I think I am going to need an actual employee or two next year.  I am terrified of the withholdings and other things involved.  No clue about how it is done.  I am sure there is software, but even with that kind of scared.  Not talking year round folk.  Just planting time and harvesting time.

So wondering, is there anything above the table / on the books like Spot Labor which is exempt from this stuff?  I looked into the rules for 1099 independent contractors, but that doesnt work because one of the rules is you can not set their hours.  I gotta figure there is something out there for hiring a person for a couple days here and there that does not require a frigging accounting department.

I asked at our extension office what to do about field labor.  They want me to use a temporary agency.  You pay the temporary agency, they worry about all the book keeping.  Thing is, oh damn they are expensive.  You pay something like 17 bucks an hour and the employee gets like 12.  Seems really messed up.
 
It's been a few years since looking at 1099 issues, but basically...a 1099 situation is where a business hires another business to do certain tasks or work.  
 
In our situation as electrical contractors, the general contractor or...private person as the case may be...hires us to do work.  We are self employed and pay federal taxes as self employed people, which means we pay  SS, Medicare and Withholding on ourselves on the money we make.  
 
In an Employee/Employer relationship, the employer is responsible for paying all those taxes on behalf of the employee.  In a 1099 relationship, the hired person is responsible for paying those taxes on themselves.
 
Some Criteria for 1099's are-
The hired person sets their own hours- as a farmer hiring help, you cannot say 'be here at 6:00am', but you can say "I need XXX pounds of turnips harvested tomorrow" and the hired person figures out what hours they want to work to accomplish that goal.  
The hired person works for other people- they can work for you for weeks on end (or a few days a week), and when their work with you is done, they can work for other people.  
The hired person supplies their own tools- as electricians, we bring all our own tools to the job.  For a farm hand, they may need to supply their own gloves/shovel/pruners/etc.  
The hired had is responsible for paying all applicable state and federal taxes on themselves- this is where you will likely find the most resistance.  Your hired help will have to file and pay taxes as a self employed person.
 
 
Here's some info on taxes from a post I was working on-
 [SIZE=medium]Remember, if you make money, you pay taxes.  Every person who has ever gotten a paycheck has paid taxes.  Those line items on the pay stub called “Withholding, Social Security and Medicare” are taxes withheld from the employees’ paycheck by the employer and sent to the Federal Government on the employee’s behalf.  [/SIZE]

 
[SIZE=medium]What most employees don’t realize is- those 2 items of SS and Medicare that are taken out of the paycheck (currently amounting to ~7.5% of the paycheck)…the employer is required to match that same 7.5% amount out of their own pocket.  As a Self Employed business person( as a sauce maker)m, you are required to pay the full 15% taxes on the income made in the sauce business.  Plus the Withholding amount!  Something to keep in mind when all that dough starts rolling in.  Set aside a good portion of it to hand over to Uncle Sam at the end of the year.  [/SIZE]
 
[SIZE=medium]BUT!  Being a self employed business person, you are allowed to take deductions for expenses like mileage driven delivering sauces, shipping, farmers market stall fees…..that will help with taxes owed, but not entirely.  There are just too many tax and business scenarios to consider here on a forum. So do your homework, get educated, please utilize the resources listed at the start of this post for detailed information on state and federal tax items.  They know what is required for your state and your business situation.  [/SIZE]

 
 
 
 
 
 
 
Hotpeper, ye that is what I was worried about.  If I need so much as a days help, I have to figure out how to do all that junk.

Salsalady, ye the 15% (ish) gets taken on the Schedule SE and the income gets recognized on the Loss or Profit.  That is all easy.  Its doing something new, having employees that is the challenge.  I am looking threw quick books and other services to see how it is done.
 
I think you can have temporary help (like when the carnival comes to town and they hire people for 12 hours a day for 4 days, etc) but I (think) that temp employment is limited to 2 weeks.  If you only hire the babysitter for time within a 2 week period, they could be hired as temp help and paid cash.  
 
When looking at parttime hours over 4-5 months, I think that goes back to either hiring as an employee or 1099.
 
But Don't take my word for it!!! I'm not an accountant, and I didn't stay at a Holiday Inn Express any time in the last 6 months.  :lol:
 
hire an apprentice or two, I think the books allow for that. Here ye here ye, according to the laws laid down by billy windingo, in 1320 it is legal to hire able bodied persons to farm the farm. An apprentice learns the art in exchange for knowledge.
 
Salsalady, ye I think I need to buy software.  I made an appointment with the VA.  They have mentors and programs to help vets start a business.  It was really weird.  In one phone call about help with my business, they asked me if I was considering suicide three times.  Each time I was transferred to someone they asked again.

There is software, so I will be fine.
 
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