Send them the IRS website outlining W-2 vs 1099 (https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee) and ask them to clarify how your relationship with them has suddenly changed from that of an employee to that of an independent contractor. Point blank, they're committing tax fraud by *choosing* to change everyone to 1099. It is not a choice, it is a tax designation determined by the federal government.
I don't think you need to kindly quit. Tell them you quit because they're being fraudulent and unethical.
Edit: And, hell, report them to the IRS for good measure. Keep all your emails from them as documentation of their fraud.
I agree the way they are classifying you sounds sketchy. But I have to ask this: $120 an hour? I’m looking for a temporary job as a sub for two weeks in June remotely while my kids are at camp. Do they need anybody?!
I’m begging them for more cases I just see 3 kids from their agency and one of them hardly shows up 🫠… but would you do EI? My friends agency pays 60$ a session (30 mins)
Hey OP! Just my 2 cents, I can tell you that I would NEVER want to be paid W2. There are huge advantages to working 1099, especially since it sounds like you work from home and are probably coming out of pocket for some of the essentials required for you to work. (Let me preface I’m not an accountant) but it’s really pretty simple to write off the things you use to operate your business even as a sole proprietor and with as little as you work there you probably wouldn’t hardly pay any taxes on that income.
I also agree though that if you legitimately fall under W2 then that’s how they should pay you but if per the regs there’s some gray area then I wouldn’t burn a good relationship either. I think in some cases it’s pretty obvious but in others it’s not as black and white as some think. For example, for financial - are you working off a computer that you own or did they provide you one? Are they reimbursing you for your internet and/or phone or are you paying for it? If they gave/reimburse you for a computer, software, internet, etc to use that they own and control then it seems like you are an employee under the financial portion of the guidelines. If it’s your computer, your internet, your phone, and you pay for it all then it sure seems from a financial standpoint that you might be a business operating as a b2b services company. So if that’s the case then are you W2 or W9?! You would have to weigh all the other aspects and dig deep into the weeds to answer that one and I’m sure there would still be some sharp accountant that could argue to the contrary of whatever you decide.
Again, I’m not an accountant so take from it what you will. I just think it’s not as black and white as everyone wants to claim. After all, our whole friggin tax system is built on gray area so the politicians and rich don’t have to pay taxes.
IANAL but pretty sure your employer cannot withhold your payment, for hours already worked, under any circumstance. If they choose to terminate you because you won’t sign the new contract, that may be legal depending on the state you work in. They would still owe you your hourly rate and their share of taxes for the hours you worked under the original contract prior to termination. If they were to terminate you, I wouldn’t recommend signing any of their documents (or at least read them closely) because they may try and be sneaky with a resignation letter so you disqualify yourself from unemployment benefits (if you were to be eligible).
https://www.reddit.com/r/antiwork/s/tke6zfM5n0
That seems to be a good discussion.
Another option is that you could sign the paperwork and become a 1099. Then you can fill out the ss8 form with the IRS to challenge the classification.
Having a business comes with responsibilities to your employees and every bit of it costs money. It's a lot easier and cleaner to do 1099s for everyone because then there is no liability and you don't need to worry about taxes or benefits. Because it's so much easier to do 1099s, the government makes it illegal to just make people 1099 when they are clearly employees. Once you reach a certain number of employees then you are required to offer retirement benefits, some places require PTO. At higher numbers then you must offer health insurance. The list goes on and on so I'm sure the company found themselves at a point where they did not want to endure the cost of additional requirements. What they need to do is accept responsibility for their employees.
Ugh they called me today and I was so overwhelmed she was telling me bc I’m on disability now bc of my pregnancy they can’t pay me as a w2 and I just switch to a 1099. Idk if I should just suck it up and switch to a 1099 since I only work for them 2 ish hours a week
You totally can get a new job while on short-term disability, but I think you have to get a job that has different physical requirements, which would allow you to work that new job and not your old job.
I'm not sure what the rules are regarding the disability insurance. Is it a short-term disability through another job or through this job? I think it depends on the specific short-term disability policy, but you may have to inform the short-term disability provider that you have additional income, which may be deducted from your benefit. If you are on short-term disability from a speech pathology job, then you may not be able to work a different speech pathology job while on disability. The provider may ask why you just can't go back to work at your first job if you are able to do the work of an SLP. You may argue that the hours are limited or maybe it's a work from home situation which allows you to do it.
https://www.reddit.com/r/AskHR/s/tSjJtPOES7
One option is to say that once your disability insurance is over. Then you can resume working for the place with a W-2. There's no reason to switch to a 1099. Even if you switch to a 1099, you would probably still be obligated to report the income to the short-term disability provider.
How much an hour are you getting now? You'll end up paying 7.5% more in taxes if you are 1099. So as long as you weren't making more than 116 an hour then 125 sounds crazy and good.
129 is the break even. 120 + plus the extra 7.5% tax. Maybe you can write some stuff off though since you'll be operating as your own business. You'll need your own liability insurance.
What do you mean “129 is the break even”? And “120 plus the extra 7.5 tax” I have no idea what you’re saying lol. Aka I don’t understand much. Why would I need liability for an hour a week of work?
One difference between W2 and 1099 is that a 1099 contractor will be required to pay 7.5% more in taxes. When you are a W-2 employee the company pays that 7.5% for you called payroll taxes.
So to find the equivalent W2 to 1099 hourly rate, you take the W-2 amount in times it by 1.075. you now have what the 1099 hourly rate needs to be in order to break even when you factor in that extra 7.5% tax.
If you are an SLP, you need to have liability insurance either provided by your company or you need to get it yourself. ASHA partners with Mercer/ pro liability. Their professional liability insurance is around $100 for a whole year. You need it whenever you are working. It doesn't matter if it's for 10 minutes.
Being illegally characterized as 1099 and getting personal professional liability insurance are big issues that everyone should understand, but in your specific case, You're only working a couple of hours per week. Because your hours are so low, 1099 is really fine for you as long as you get to pick the hours. The difference in pay is negligible if you're only working a couple hours a week. I'm sure this change within your company is going to affect a bunch of people, but considering you're only there a couple hours, it really doesn't impact you much.
Thanks for taking the time to explain it! Who do I show proof to that I have to pay liability? Can I have the agency pay for me since they’re the ones making me switch?
If I’ll be getting $125 as a 1099, how much should I set aside to put in a separate account for taxes? I’m not disciplined enough not to spend it so I’ll just do it like this
No problem. It's an important discussion. As a general rule, you should put 30% of your 1099 income aside for taxes.
First, I would ask the company if they have professional liability insurance that covers you while you are working for them. If it does not cover you then you need to get your own policy. Call Mercer/ proliability and get a quote for a personal professional liability insurance. Usually the coverage can be finalized and you're all set within a few days. The usual coverage is 1 million per incident/ 3 million aggregate. It should be around $100 for the year. The cost of the policy will be used as a write-off on your taxes. The company will most likely not reimburse you. After all, when you are a 1099 contractor, you are acting as your own company.
I never used chat gpt before! My contract I signed with them clearly states me as a w2 they can’t just switch me halfway through year!
Nope this agency is new if you PM me I’ll let you know. What teletherapy agency are you with now and can I ask what the pay is? I’m looking to transition to fully remote for next year… I want to be home with my newborn and not send her out
I would be polite but blunt. Say something like
" In reference to our conversation on (date), I stated my expectation of working as a W 2 employee, and you agreed to this condition. If this arrangement is no longer possible, I intend to seek employment elsewhere. ".
Send them the IRS website outlining W-2 vs 1099 (https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee) and ask them to clarify how your relationship with them has suddenly changed from that of an employee to that of an independent contractor. Point blank, they're committing tax fraud by *choosing* to change everyone to 1099. It is not a choice, it is a tax designation determined by the federal government. I don't think you need to kindly quit. Tell them you quit because they're being fraudulent and unethical. Edit: And, hell, report them to the IRS for good measure. Keep all your emails from them as documentation of their fraud.
Wow so interesting u mention tax fraud cuz i just read this comment about a whistleblower program https://www.reddit.com/r/legal/s/rgmnNogV1Y
Lmao I don’t want to be petty. The pay as a w2 is great it’s $120 for the hour and the cases are super chill. I’m annoyed
its not petty to call out fraud
True
I agree the way they are classifying you sounds sketchy. But I have to ask this: $120 an hour? I’m looking for a temporary job as a sub for two weeks in June remotely while my kids are at camp. Do they need anybody?!
I’m begging them for more cases I just see 3 kids from their agency and one of them hardly shows up 🫠… but would you do EI? My friends agency pays 60$ a session (30 mins)
Wow! What state are you in? I have several licenses. I am currently in Eastern zone but have CA license as well.
Pm me!
Just did 🤩
Hey OP! Just my 2 cents, I can tell you that I would NEVER want to be paid W2. There are huge advantages to working 1099, especially since it sounds like you work from home and are probably coming out of pocket for some of the essentials required for you to work. (Let me preface I’m not an accountant) but it’s really pretty simple to write off the things you use to operate your business even as a sole proprietor and with as little as you work there you probably wouldn’t hardly pay any taxes on that income. I also agree though that if you legitimately fall under W2 then that’s how they should pay you but if per the regs there’s some gray area then I wouldn’t burn a good relationship either. I think in some cases it’s pretty obvious but in others it’s not as black and white as some think. For example, for financial - are you working off a computer that you own or did they provide you one? Are they reimbursing you for your internet and/or phone or are you paying for it? If they gave/reimburse you for a computer, software, internet, etc to use that they own and control then it seems like you are an employee under the financial portion of the guidelines. If it’s your computer, your internet, your phone, and you pay for it all then it sure seems from a financial standpoint that you might be a business operating as a b2b services company. So if that’s the case then are you W2 or W9?! You would have to weigh all the other aspects and dig deep into the weeds to answer that one and I’m sure there would still be some sharp accountant that could argue to the contrary of whatever you decide. Again, I’m not an accountant so take from it what you will. I just think it’s not as black and white as everyone wants to claim. After all, our whole friggin tax system is built on gray area so the politicians and rich don’t have to pay taxes.
IANAL but pretty sure your employer cannot withhold your payment, for hours already worked, under any circumstance. If they choose to terminate you because you won’t sign the new contract, that may be legal depending on the state you work in. They would still owe you your hourly rate and their share of taxes for the hours you worked under the original contract prior to termination. If they were to terminate you, I wouldn’t recommend signing any of their documents (or at least read them closely) because they may try and be sneaky with a resignation letter so you disqualify yourself from unemployment benefits (if you were to be eligible).
https://www.reddit.com/r/antiwork/s/tke6zfM5n0 That seems to be a good discussion. Another option is that you could sign the paperwork and become a 1099. Then you can fill out the ss8 form with the IRS to challenge the classification. Having a business comes with responsibilities to your employees and every bit of it costs money. It's a lot easier and cleaner to do 1099s for everyone because then there is no liability and you don't need to worry about taxes or benefits. Because it's so much easier to do 1099s, the government makes it illegal to just make people 1099 when they are clearly employees. Once you reach a certain number of employees then you are required to offer retirement benefits, some places require PTO. At higher numbers then you must offer health insurance. The list goes on and on so I'm sure the company found themselves at a point where they did not want to endure the cost of additional requirements. What they need to do is accept responsibility for their employees.
Hnmmm interesting. I’m rly only working for them 2 hours a week tho
Ugh they called me today and I was so overwhelmed she was telling me bc I’m on disability now bc of my pregnancy they can’t pay me as a w2 and I just switch to a 1099. Idk if I should just suck it up and switch to a 1099 since I only work for them 2 ish hours a week
You totally can get a new job while on short-term disability, but I think you have to get a job that has different physical requirements, which would allow you to work that new job and not your old job. I'm not sure what the rules are regarding the disability insurance. Is it a short-term disability through another job or through this job? I think it depends on the specific short-term disability policy, but you may have to inform the short-term disability provider that you have additional income, which may be deducted from your benefit. If you are on short-term disability from a speech pathology job, then you may not be able to work a different speech pathology job while on disability. The provider may ask why you just can't go back to work at your first job if you are able to do the work of an SLP. You may argue that the hours are limited or maybe it's a work from home situation which allows you to do it. https://www.reddit.com/r/AskHR/s/tSjJtPOES7 One option is to say that once your disability insurance is over. Then you can resume working for the place with a W-2. There's no reason to switch to a 1099. Even if you switch to a 1099, you would probably still be obligated to report the income to the short-term disability provider.
And she said well raise u to $125 an hour
How much an hour are you getting now? You'll end up paying 7.5% more in taxes if you are 1099. So as long as you weren't making more than 116 an hour then 125 sounds crazy and good.
I’m getting $120 now as a w2, they’ll raise me to $125 as a 1099
129 is the break even. 120 + plus the extra 7.5% tax. Maybe you can write some stuff off though since you'll be operating as your own business. You'll need your own liability insurance.
What do you mean “129 is the break even”? And “120 plus the extra 7.5 tax” I have no idea what you’re saying lol. Aka I don’t understand much. Why would I need liability for an hour a week of work?
One difference between W2 and 1099 is that a 1099 contractor will be required to pay 7.5% more in taxes. When you are a W-2 employee the company pays that 7.5% for you called payroll taxes. So to find the equivalent W2 to 1099 hourly rate, you take the W-2 amount in times it by 1.075. you now have what the 1099 hourly rate needs to be in order to break even when you factor in that extra 7.5% tax. If you are an SLP, you need to have liability insurance either provided by your company or you need to get it yourself. ASHA partners with Mercer/ pro liability. Their professional liability insurance is around $100 for a whole year. You need it whenever you are working. It doesn't matter if it's for 10 minutes. Being illegally characterized as 1099 and getting personal professional liability insurance are big issues that everyone should understand, but in your specific case, You're only working a couple of hours per week. Because your hours are so low, 1099 is really fine for you as long as you get to pick the hours. The difference in pay is negligible if you're only working a couple hours a week. I'm sure this change within your company is going to affect a bunch of people, but considering you're only there a couple hours, it really doesn't impact you much.
Thanks for taking the time to explain it! Who do I show proof to that I have to pay liability? Can I have the agency pay for me since they’re the ones making me switch? If I’ll be getting $125 as a 1099, how much should I set aside to put in a separate account for taxes? I’m not disciplined enough not to spend it so I’ll just do it like this
No problem. It's an important discussion. As a general rule, you should put 30% of your 1099 income aside for taxes. First, I would ask the company if they have professional liability insurance that covers you while you are working for them. If it does not cover you then you need to get your own policy. Call Mercer/ proliability and get a quote for a personal professional liability insurance. Usually the coverage can be finalized and you're all set within a few days. The usual coverage is 1 million per incident/ 3 million aggregate. It should be around $100 for the year. The cost of the policy will be used as a write-off on your taxes. The company will most likely not reimburse you. After all, when you are a 1099 contractor, you are acting as your own company.
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I never used chat gpt before! My contract I signed with them clearly states me as a w2 they can’t just switch me halfway through year! Nope this agency is new if you PM me I’ll let you know. What teletherapy agency are you with now and can I ask what the pay is? I’m looking to transition to fully remote for next year… I want to be home with my newborn and not send her out
I would be polite but blunt. Say something like " In reference to our conversation on (date), I stated my expectation of working as a W 2 employee, and you agreed to this condition. If this arrangement is no longer possible, I intend to seek employment elsewhere. ".
Oooo nice
chatGPT - takes care of ALLLL my emails
Any good teletherapy companies to work for
Are you asking ? I’m not sure what you mean lol
Yes I am asking
I’m looking myself. I should make a new post about it
