ind. contractor and 1099s
My status is this: I've been redeeming lawful money since 2010 (thank you David!!) and have been fortunate not to work since then -no bank acct, no employee status, no 1099 contractor, no filing requirements. I am a clean slate, especially for 2013 and beyond. I need to work again, and am able to work in a place of fine dining. My only intent is to do things lawfully.
I have heard that "under the table" work is not legal, but what defines that? Is it a company (entagled in state laws, taxes, etc) that pays the worker, therfore creating undocumented income? What if working for cash tips alone? The company pays you nothing, you are basically getting paid by the public... no different than a beggar or street busker on a subway, no? Can you AND/OR the company get in trouble if you and they agree on "free" work, ie. a volunteer? Must it be via private contract (and via verbage of lawful money for good measure?)
Now, what if that is not agreeable (or legal), and one still wants to work for JUST cash tips, but to keep the fine dining's accountant and owner stress free, you agree to provide a SSN, verbiage of lawful money, and expect the company to issue a 1099 (this has been offered)... How can a company claim on a 1099 they are paying you? Aren't they saying you were paid money by yet several other 3rd parties?
I am trying to place the best course of action over a time sensitive matter. I thank you all!
1099 presumes independent basis for taxation
Quote:
Originally Posted by
Topgun
My status is this: I've been redeeming lawful money since 2010 (thank you David!!) and have been fortunate not to work since then -no bank acct, no employee status, no 1099 contractor, no filing requirements. I am a clean slate, especially for 2013 and beyond. I need to work again, and am able to work in a place of fine dining. My only intent is to do things lawfully.
I have heard that "under the table" work is not legal, but what defines that? Is it a company (entagled in state laws, taxes, etc) that pays the worker, therfore creating undocumented income? What if working for cash tips alone? The company pays you nothing, you are basically getting paid by the public... no different than a beggar or street busker on a subway, no? Can you AND/OR the company get in trouble if you and they agree on "free" work, ie. a volunteer? Must it be via private contract (and via verbage of lawful money for good measure?)
Now, what if that is not agreeable (or legal), and one still wants to work for JUST cash tips, but to keep the fine dining's accountant and owner stress free, you agree to provide a SSN, verbiage of lawful money, and expect the company to issue a 1099 (this has been offered)... How can a company claim on a 1099 they are paying you? Aren't they saying you were paid money by yet several other 3rd parties?
I am trying to place the best course of action over a time sensitive matter. I thank you all!
The 1099 is used to create the illusion of another basis for taxation, apart from the basis that arises from the receipt of FRN's. If the payer insists on collecting an SSN from you, flip around some of the digits in your SSN (you can claim dyslexia if it ever comes up) and consider giving him an alternate address (not one the IRS already has for you). Without the correct SSN and with a different address, the IRS will never be able to track the payment to you.
You can subtly note duress on the form he forces you to fill out with a "TDC" (for threat duress, coercion) so you can void the instrument later (especially if you are nervous about giving a false SSN, which Supreme Court says is not a crime BTW) but even this is not necessary if you are worried it will cause a problem with the payer. The duress is there whether you note it on the document or not.
Be sure to demand PAYMENT IN LAWFUL MONEY AND sign your name "without prejudice" on all forms he forces you to fill out, so that you cannot be deemed to be voluntarily accepting any undisclosed benefit (such as receiving elastic currency) or be held obligated to any undisclosed terms or obligations (such as the fact that many of the words on these forms you are signing have custom definitions in Federal law, and thus the form creates a presumption that your work is Federally connected, creating a basis for treating the payment as "gross income" received in connection with a "trade or business" within the "United States".
Years ago I declined to give an SSN to a payer, did not report the money he paid me, and never heard anything about it. I don't even know if he issued a 1099, but without an SSN it was pretty useless to the IRS.
No one can compel you into a contract.
Quote:
Originally Posted by
TDL
With all due respect, what you suggest is a rather "slippery slope" to go down. Afaik, in general, payors request that you tender a Form W-9 (or a derivative/equivalent form) which must be signed under PoP (Penalties of perjury). Moreover, it also goes to your intent, and intent leads to your character. Could you stand before a jury and swear to your action being the "truth and nothing but the truth"? Don't think so ...
Lastly, there's a special program in play by Auntie [IRiS] called "Identity Theft", which tracks just such activities and has a penalty-escalation provision in place as well. Upshot: don't do it -- you're apt to shoot yourself in the foot.
However, one perfectly legal route I found workable is to demand that the payor produce a fW-9 that bears a valid OMB-Control Number. I'd also state that when s/he does, I'd be glad to comply. Though I could be wrong, after years of looking, I have yet to find such form. Auntie [IRiS] clearly understands the form's deceptive (read:entrapment) nature, but cannot mandate its use for the non-federally-connected business sector. How do I know this? Since IRC Sec. 6109 is the governing statute (mandating SSN-use for all federally-connected purposes), it would be simple to get fW-9 OMB-approved, but it is not (yet).
My intent would simply be to exercise my right to make a living without being compelled into a commercial contract with the United States. I could certainly swear truthfully that I was under duress in furnishing an SSN and submitting the W-9 or W-4 form absent proof that I am required to furnish this information in the first place. Such duress makes these forms voidable and invalid. And it is not "identity theft" to provide an incorrect number if you are not knowingly using someone else's number. Supreme Court ruled just a couple of years ago that it is not unlawful to provide an incorrect SSN, if you are not knowingly using someone else's number.
In a famous case involving Taco Bell years ago, a Federal Court established that a SSN could not be required for working in this country. SSA has admitted this as well. A payer who compels the use of a SSN is in violation of the law and exerting undue influence. You are therefore under duress and the W-9 and W-4 is voidable in any case.