I am thinking of trying to figure out having someone help me. I would rather have someone that is a contractor and takes care of their own taxes and stuff. Does anyone here have people like that or have thoughts, advice or whatever? Just something I am thinking about... Thanks!

If you do hire someone, just be sure that they understand that you will not be taking taxes out of their earnings and that you will supply them with a 1099 Misc at the end of the year.

I subcontract all my children's cakes, shower cakes and slab cake orders to my friend who was a Pastry Chef with me at a local restaurant. I HATE doing those cakes!

Bonnie:

Beware, there are loop holes lurking here...such as workers' compensation.

If the person you hire would get hurt in anyway, even if they are paying their own taxes, you could still be liable.

I work for a workers' comp attorney here in Ohio and according to Ohio laws, even if the person is taking care of their own taxes, if they are using your tools, supplies, etc, they are considered an employee; therefore you would have to have coverage on them. I have seen this happen so many times it is unreal. You should check out your state's regulations and laws, etc just to keep yourself safe here. I back injury could end up costing you thousands of dollars!!

Hope this helps!!
Kristina

Thanks guys! Kristina that is good to know. I wil make sure of that before I do it. Would that be just adding her to my insurance?

Antonia how do you subcontract? Do you get all payments and pay her or does she get paid for the cakes she does on her own?

If you already have workers' comp coverage then yes just adding her to your coverage would take care of it. Call your local Bureau of Workers' Compensation. Your case manager should be able to answer any questions you would have. Sometimes just saying that they are an independent contractor is not enough, especially if your are providing the equipment that they use.

I would just hate to see anyone lose out because they were not informed.

As they say in the legal field "ignorance of the law is no excuse".

I hope that I have been able to help you (or anyone else) with this matter!

Kristina

She gets paid 85% of the cake's total. The 15% is mine as a "finder's fee".

I also pay caterers 10%-15% of the cake's price if I am referred to their client through them.

As Kristina says, if they use your equipment and you direct their work, they are employees. You MUST pay payroll taxes as well as Workers comp for employes.

You can refer cakes to another decorator for a "finders fee" and only be responsible for reporting your own income. Be sure to put your agreement in writing. The risk of this is that your decorator will have access to your clients. But if you are very busy, it probably won't hurt you.

If you want someone to come in and help you bake and clean up, then you need to establish yourself as an employer.

The IRS does not have a sense of humor about "employers" who don't comply with the rules. They can really make your life miserable.

In my other job, I process levies filed by the IRS that take 100% of all payments to that business to repay unpaid taxes and penalties.

JoAnn

Would it be the same if I was doing what antonia is doing? I want to do this right but the easiest way for me. I don't want to be filing paperworks for someone else. At least not right now.

Antonia she has her own business as well right? I know a couple friends I know do this. They both work under the same business name in some ways but one is contracted under the other. The contracted one also has her own business license, and name on her own bank account etc.

I guess I am not sure what all I want to do..LOL I just would like some help and I know someone trying to get started also.

The workers compensation thing, is that under my business insurance?

Antonia74's location states she's from Toronto, Canada. The two countries may have different ways of handling this type of situation. Law vary from county to county and state to state. Then it's a whole other ball game when it's another country. Check it out to be on the safe side.



Princess

Workers' compensation is different from your business insurance. At least in the State of Ohio. You should check with your state to make sure that you have the right coverage. If nothing else your business insurance company should be able to point you in the right direction.