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LLC/Personal Liabilty ?s

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  • #16
    Contact a CPA that is familiar with Small Business- cheaper than a Lawyer.

    A phone call is free to the CPA and Insurance agent -- preferably get some references.

    They will (should) know the Tax laws and will be able to help you with what you can and can not deduct as well as what is the best way to set up your company e.g. sole proprietorship, partnership, corporation, and S corporation, LLC. and what each of these offers.

    Contact an Insurance agent for your Insurance needs.

    http://www.irs.gov/businesses/small/...115045,00.html

    http://www.irs.gov/businesses/small/...=99921,00.html

    have fun reading


    Any good Lawyer will tell you straight up that you can be sued for anything- having Insurance does not release one from Liability or from Idiots.

    Comment


    • #17
      A. You can do piece work and still be considered an employee. It's very common in certain industries. So, for now, it's better for you that they want to treat you as an employee. Saves you all the payroll, social sec, etc. hassles.

      B. Since they want you to work at home using your own tools, better make sure that your homeowners, liability and fire insurance covers work-related activities in your home. You might want to factor that cost in when you figure out how much they're actually paying you.

      C. Despite what people tell you, you are always liable for your own negligence -- even when you work for somebody else. As a matter of course, they'll sue both the company and you in a law suit. So make sure that you're covered by the company's E&O insurance.

      D. Good CPAs aren't any cheaper than good attorneys. You might as well check with both. Better to be safe than sorry. An employment attorney to review your employment arrangement to make sure that you are an employee and that your butt is securely covered. And a CPA to advise you about how to make sure you act like an employee and not an independent contractor, and how to take full advantage of those "home office" tax deductions.

      E. If you decide later that you want to set up your own company, make sure you talk to a CPA and business attorney about which form of business entity would work best for your situation. Make sure you follow what they tell you. Nothing more wasteful than shelling out a lot of money to experts and not following their advice.

      Comment


      • #18
        I just happened to see the following news article in the local "fish wrap", and thought of this thread. This is an example of how screwed up things can get if not done right.

        A federal jury has convicted a 59-year-old Livingston man for failure to pay more than $500,000 in federal taxes on the wages of nurses in his employ, according to the U.S. District Attorney for the District of Minnesota.

        Francis Leroy McLain, owner of a nursing professionals company, was found guilty on nine counts of failure to account for and pay employment taxes.

        McLain was indicted on Jan. 8. His trial this month in St. Paul, Minn., lasted nine days and the jury deliberated for three hours before issuing its verdict on Nov. 17, according to a release from the U.S. attorney’s office.

        McLain will be sentenced at a future date.

        According to the indictment, McLain failed to pay the Internal Revenue Service federal income taxes on wages earned by employees of Kirpal Nurses, which did business as Kind Hearts, based in Minneapolis, Minn. He also failed to pay the employees’ share of Federal insurance Contribution Act taxes

        “The criminal conduct spanned nine calendar quarters,” or just over two years, according to the release.

        Kind Hearts supplied nurses and other nursing professionals to various health-care facilities on a temporary basis, according to the release.

        Prior to starting Kirpal Nurses, McLain owned and operated several other temporary nursing services, including Lifelines Care, In., Lifelines Cooperative Care, Inc. and Cooperative Nurses, Inc.

        In 1995, McLain sued the United States in civil court, claiming that the nursing professionals who worked for him were independent contractors rather than employees and, therefore, he was not required to pay employment taxes, according to the release.

        The federal government disagreed and countersued.

        Those suits were settled in 1998. As part of that settlement, McLain agreed to withhold and pay employment taxes for nursing professionals who worked for any of his businesses.

        “McLain took steps to hide his ownership and involvement in Kirpal Nurses by using others as the owners and operators, including his daughter,” according to the U.S. attorney’s release. “From June 1999 through December 2001, McLain arranged to pay the IRS some, but not all of the employment taxes.”

        In May 2002, the Minnesota Department of Health advised Kirpal Nurses of a change in state law requiring all nursing professionals to be treated as employees and not as independent contractors. Seven months later, in December 2002, McLain provided the department with paperwork and “asserted that employment taxes were being withheld for all Kirpal employees, including nursing professionals.

        However, that same month, Kirpal Nurses paid the IRS $4,200 in employment taxes for the entire calendar year. “Kirpal failed to make any employment tax payments to the IRS after that.”

        The case was investigated by the IRS-Criminal Investigation Division, and was prosecuted by Assistant U.S. Attorneys David M. Genrich and Michael L. Cheever.

        Comment


        • #19
          There are so many ins and outs. You need to let a pro go over this. I know that part of the test of being a sub is wether you do work for others and it sounds like you want to have that option. You might not be able to do that if you are an employee. Insurance will try everything they can not to pay a claim so you need to be sure they understand what they are insuring. Sometimes deals like this are great and sometimes they can be a disaster. Hope this one ends up great and a good way to give it a reasonable shot is to talk to the people who get paid to have the answers.

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