The Necessary Employee Forms
        from W-2s to 1099s
                presented by
Ruth Perryman, president of The QB Sp...
Employee or Contractor?
There are three basic areas which determine
employment status:
• Behavioral control
• Financial co...
Behavioral Control
These facts show whether there is a right to
direct or control how the worker does the work
• Instructi...
Financial Control
These facts show whether there is a right to direct
or control the business part of the work.
• Does the...
Type of Relationship
These facts show how the business and the worker
perceive their relationship.
• Do you have written c...
Employees
• You must withhold income tax and your
  employee’s portion of social security and
  Medicare taxes.
• You are ...
Form W-2
The Form W-2 is used by employers to:
• Report wages, tips and other compensation
  paid to an employee.
• To rep...
W-2’s in QuickBooks
• Basic Payroll
  – No tax forms, only reports that your accountant
    can use to prepare them
• Enha...
Independent Contractors
• You may be required to file Form 1099-MISC,
  Miscellaneous Income, to report what you
  have pa...
Form 1099-MISC
The Form 1099-MISC is:
• Used to report payments made in the course of a
  trade or business to another per...
1099’s in QuickBooks
• Turn on 1099 preference
  – Edit > Preferences > Tax: 1099 > Company Preferences
    tab, check box...
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The Necessary Employee Forms from W-2s to 1099s

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You know you need to hire employees, but what forms do you need and why?

Ruth Perryman, MBA, Community AllStar and president of The QB Specialists will walk us through the essential forms like the W-2 and 1099. She will also discuss when its best to hire an employee and when to use a contractor. Join us for this informative event geared to help new business owners and those who just have a few questions.

11/04/09 - Wednesday at 9:00AM PT
Register for this Event:
http://is.gd/4MkZE

Published in: Business, Technology
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The Necessary Employee Forms from W-2s to 1099s

  1. 1. The Necessary Employee Forms from W-2s to 1099s presented by Ruth Perryman, president of The QB Specialists Intuit Solutions Provider Certified Advanced QuickBooks ProAdvisor Member of Intuit’s Trainer/Writer Network www.theQBspecialists.com Sales: 800-707-0940 | Support: 888-351-5285
  2. 2. Employee or Contractor? There are three basic areas which determine employment status: • Behavioral control • Financial control • Type of Relationship
  3. 3. Behavioral Control These facts show whether there is a right to direct or control how the worker does the work • Instructions – how, when, or where to do the work – what tools or equipment to use – what assistants to hire to help with the work – where to purchase supplies and services • Training
  4. 4. Financial Control These facts show whether there is a right to direct or control the business part of the work. • Does the worker has unreimbursed business expenses? • Did the worker invest in the facilities used in performing services? • Does the worker makes his or her services available to the relevant market? • How do you pay the worker? • Can the worker can realize a profit or incur a loss?
  5. 5. Type of Relationship These facts show how the business and the worker perceive their relationship. • Do you have written contracts describing the relationship the parties intended to create? • Is the worker available to perform services for other, similar businesses? • Do you provide the worker with employee–type benefits, such as insurance, a pension plan, vacation pay, or sick pay? • How permanent is the relationship? • Are the services performed by the worker a key aspect of the regular business of the company ?
  6. 6. Employees • You must withhold income tax and your employee’s portion of social security and Medicare taxes. • You are also responsible for paying social security, Medicare, and unemployment (FUTA) taxes on your employees’ wages. • You must file a Form W-2, Wage and Tax Statement, showing the amount of taxes withheld from your employees’ pay.
  7. 7. Form W-2 The Form W-2 is used by employers to: • Report wages, tips and other compensation paid to an employee. • To report the employee's income tax and Social Security taxes withheld and any advanced earned income credit payments. • To report wage information to the employee, the Internal Revenue Service and the Social Security Administration.
  8. 8. W-2’s in QuickBooks • Basic Payroll – No tax forms, only reports that your accountant can use to prepare them • Enhanced Payroll – Includes all federal and many state tax forms, you pay taxes and file forms • Assisted Payroll – Intuit handles your payroll taxes for you
  9. 9. Independent Contractors • You may be required to file Form 1099-MISC, Miscellaneous Income, to report what you have paid to your independent contractors. • You do not have to withhold taxes from your independent contractors’ pay. They are responsible for paying their own income tax and self-employment tax.
  10. 10. Form 1099-MISC The Form 1099-MISC is: • Used to report payments made in the course of a trade or business to another person or business who is not an employee. • Required among other things, when payments of $10 or more in gross royalties or $600 or more in rents or compensation are paid. • Provided by the payer to the IRS and the person or business that received the payment.
  11. 11. 1099’s in QuickBooks • Turn on 1099 preference – Edit > Preferences > Tax: 1099 > Company Preferences tab, check box next to Do you file 1099-Misc forms and select accounts you use to pay subcontractors next to Box 7 • Setup subcontractors as 1099 vendors – Double-click on vendor, select Additional Info tab, check box next to Vendor eligible for 1099 • Manage reporting process – Vendors > Print 1099’s/1096
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