employee or a contract labor

[rgvtutor]

Hello,
My name is Elizabeth I started my own tutoring business October 2009. After teaching for a couple years found out it was all politics.
When I started tutoring I had 15 students and grew to 15 within 3months which was kind over welling at first.


Now I’m considering hiring people to help me tutor since I’m turning people down.

Here is my question I don’t know if I should hire them as a employee or a contract labor. Each person will work less than 10 hours a week. What are some of the pros and cons I should consider?
I will tell them whom they would tutor, they would be their own time, they will wear uniform, and I will give them basic supplies.

Thank you
Elizabeth
rgvtutor.com

[DerekS]

Hi Elizabeth,

I'm a big advocate of 1099 contracting as it is the most streamlined approach. They're not working full time and I'm sure you'll allow them a certain degree of flexibility when setting their schedules (I bet you'll be hiring alot of full-time teachers who need extra $$$.)

So I'd go with the 1099 option. I can only think of the pro's (maybe someone else can chime in with a con or two, but I'm drawing a blank.)

PS - I saw you're from McAllen Texas. I was there back in '05 when I was on tour with a band and thought it was a really cool city. You guys are WAAAAY far south, there were literally cars with Mexican plates in our motel parking lot. Plus it was so humid it made Baltimore in August feel like Yellowstone National Park in January.

Good luck!

[JenniferEscalona]

Hi Elizabeth, I'm with Derek. Go 1099. The only con would be if you tried to set their work hours or supervise them directly. That would make them employees instead of contractors, and if you claimed them as 1099's on your taxes when they really should have been W-2's then you would have hell to pay if the IRS found out.

The IRS has a great definition of Contractor vs. Employee on their site that you might want to look over. But I've worked for a tutoring company like yours myself, and I was, and should have been, a 1099.

[rgvtutor]

ok im going wih 1099 for now because people arent going to be work that many hours. I check with all the local tutoring places they use the 1099 form also..thanks alot

[KMDAS]

Glad you decided on contracting and good luck with your business.

[GlobalWealth]

You need to be careful with 1099 workers. The issue is the control you exert over the worker. Do you set their hours? Do you provide their teaching tools? Do you mandate a schedule? Can they work for a competitor? If you answer yes to any of these questions, they can be reclassified as employees, thereby costing you an enormous amount of money in back taxes. You should visit the irs.gov site and do a search for independent contractor classification. Read through the checklist. I am not saying you cannot do it, but you do need to be cautious.