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Old 05-12-2010, 02:34 PM   #1
Beth Rypins
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Location: Napa  CA
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To 1099 or W2 our coaches

We are a growing S corp, and currently 1099 our coaches. Are there other S corp affiliates out there than can weigh in on how long we can get away with contractors instead of employees?

Thanks, Beth
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Old 05-12-2010, 09:50 PM   #2
Damon Stewart
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Location: S Ogden  UT
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Re: To 1099 or W2 our coaches

That's a much better question for your CPA than here. If they only do the work they do for you then they are employees. If they train at multiple boxes or somewhere else than they can be a 1099.
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Old 05-12-2010, 10:26 PM   #3
Katherine Derbyshire
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Re: To 1099 or W2 our coaches

Definitely a question for a CPA. Part of the difference between a contractor and an employee is that a contractor has more control over their work hours. My clients pay me by the project, but don't dictate where or when I actually do the work. So a trainer who has his own clients on his own calendar might be different than one who is assigned to teach a regularly scheduled class. Talk to your accountant.

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Old 05-17-2010, 05:52 PM   #4
Lincoln Brigham
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Re: To 1099 or W2 our coaches

If they only do the work they do for you then they are employees.
I'm not a lawyer, but I believe the difference between contractors and employees is one of those legal issues that is judged based on a preponderance of multiple criteria and rarely is decided on only one criteria alone. Many contractors simply haven't found more than one source of work.

If you pay all your trainers the same take-it-or-leave-it rate, provide regular work, dictate the warmup and the WOD and otherwise micro-manage the workouts, make them sign a non-compete contract, supply all the equipment, provide training for the trainers, discourage them from bringing in their own equipment and their own clients, etc. then they almost certainly are employees.

On the otherhand, if you have a less formal relationship where you ask an already qualified trainer to take over some of your schedule on a class-by-class basis and give them a relatively free hand at running the classes then that might be a different story.
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Old 05-18-2010, 12:24 PM   #5
Graeme Howland
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Location: Prince George  BC
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Re: To 1099 or W2 our coaches

Control/ownership of the equipment used to earn the income is an issue in the determiniation in Canada, definitely want to discuss with CPA or lawyer since it likely has insurance impacts as well.
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Old 05-19-2010, 08:24 AM   #6
Troy Peterson
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Location: Wauwatosa  WI
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Re: To 1099 or W2 our coaches

Here's a link to IRS site in US: Ind Contractor, IRS WFS

Talk to your accountant for more specifics.

Addressing them on your Workers Compensation insurance policy is another issue that may vary by state (might need to cover them while working for you).
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