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Sidewalk guys. Pay in cash?

Discussion in 'Commercial Snow Removal' started by CK82, Nov 6, 2008.

  1. CK82

    CK82 Senior Member
    Messages: 189

    I know it is not proper practice, I am looking for a little advice and previous knowledge. I was wondering if any of you guys pay some of your guys in cash? Its dificult to find reliable guys for snow removal. I know many who are seasonal construction workers and such, looking to make some cash on the side. How do you all go about this. However I am looking into some subcontractors just for sidewalks. Sometimes you just need an extra hand, and do not have time for payroll, insurance, and what not.


    THEGOLDPRO PlowSite Veteran
    Messages: 3,136

    thats pretty standard to me.
  3. redman6565

    redman6565 PlowSite.com Addict
    Messages: 1,411

    i used to pay most of my guys in cash but then big brother (NYS) stepped in and needless to say, i dont pay cash anymore to anyone. i know its enticing to your guys however it is very risky. worse case, pay them cash and then 1099 at the end of the year.
  4. Mark Oomkes

    Mark Oomkes PlowSite Fanatic
    Messages: 13,253

    There is the option of Misc Labor. (I think there is another term for it) Up to $600 a year, just fill out the check and send it. They're responsible for the taxes. You will get dinged for it at the time of your insurance audit.
  5. terrapro

    terrapro PlowSite Veteran
    from MI
    Messages: 3,912

    1099 is just as risky. if they dont qualify you will end up getting a big tax bill at the end of the year on top of your workmans comp.

    as i understand it to qualify to 1099-
    they need their own tools(shovel)
    drive themselves around in their own vehicle
    work on their own time
    they also need to be properly compensated for their time, gas, and equipment otherwise it will be a red flag to the IRS.....you cant pay them $6.50 per hour

    basically all you can do is give them a list of jobs to do and they do it however they need to to get it done. of course if they dont do a good job you dont give them any more work next time.
  6. redman6565

    redman6565 PlowSite.com Addict
    Messages: 1,411

    that's true, i never quite thought of that. another option but it would be considered "tax evasion" (and im not telling you to do this) but you can pay each guy cash up to 500.00 and then when they are due another check you write it to someone in their family or somebody they trust and you guy can have that person cash it for them. techinically you never go over the 500.00 buffer.
  7. Sno4U

    Sno4U Senior Member
    Messages: 480

    Here in WI they call it "casual labor". I forget what the number is for each person but just check into it in OUR state b/c it seems that $$$ is different for each State.
  8. Mark Oomkes

    Mark Oomkes PlowSite Fanatic
    Messages: 13,253

    That's what I was trying to remember. Casual labor. Pretty sure it's $600 based on the IRS. Could be wrong, though.
  9. tjlands

    tjlands Senior Member
    Messages: 579

    It is $600. I just get the employee to sign a log book(receipt) when i pay them. My insurance audit did not question it they just added it to my total payroll.
  10. CK82

    CK82 Senior Member
    Messages: 189

    So pay them up to $600 out of the business account, and the remainder if any to a "friend or family member". So while they are working for you up to $600 who insures them? I have used the casual labor for up to $600 for guys in the past. Generally there wages go over the mark. I guess I know what is legal and what is not legal, but I am looking for ways around it. Like I was saying its extremely hard to find guys to work for you who may only work a hand full of times per winter. I was thinking of hiring some subs just for sidewalk work, since it is relatively simple to do. I have yet to venture far into the subcontractor area for plow trucks.
  11. Superior L & L

    Superior L & L PlowSite Veteran
    from MI
    Messages: 3,041

    Payroll is the only way to go for us. We have talked many times to our accountant about this and you have to cut them a regular payroll check if they are your regular workers. The people that have been on your payroll that year cannot recieve a casual labor check because technically they are your employees
  12. IMAGE

    IMAGE Sponsor
    Messages: 1,747

    :eek:are you guys serious? Yeah I am sure all successful businesses pay in cash:rolleyes:, especially the ones that have all thier ducks in a row and know what needs to be done to succeed.

    If you can't or don't want to do payroll, use a payroll service to do it for you. Costs me $30 to have payroll run for me, and they keep track of everything, all I do is give them the time cards.

    Now sure if its a one time thing where a buddy is just helping you for a night, sure cash is cool, but if your talking its gonna be a regular or semi regular thing... cover your ass.
  13. LwnmwrMan22

    LwnmwrMan22 PlowSite Fanatic
    Messages: 28,362

    For what it's worth, you guys might want to watch what you post on here.

    Yesterday I was contacted by a US Postal Investigator about some comments I made on LawnSite.com about an account I service.

    I really wouldn't be posting on a public website that you're basically looking to avoid taxes, whether payroll or income.
  14. capnsac

    capnsac Member
    Messages: 73

    See the problem I have with paying guys in cash is where does that cash come from? Usually from your pocket, which you've already paid taxes on, so they're getting tax free money on something I've had to pay taxes on? For a lack of a better word, F*CK that! Besides, if I get caught, then I'm doubly screwed. It's a lose lose my friend.
  15. capnsac

    capnsac Member
    Messages: 73

    P.S. you can do a one-time $600 check on a per person basis, then let them cash that and divvy it out. That is 100% legal, you just have to have enough hectors, pedros, etc....
  16. capnsac

    capnsac Member
    Messages: 73

    P.P.S. didn't read the above post, so sorry!
  17. bribrius

    bribrius PlowSite.com Addict
    Messages: 1,609

    I like cash. :D

    One of my favorite things. payup
  18. elite1msmith

    elite1msmith 2000 Club Member
    from chicago
    Messages: 2,762

    iv been trieng to tell you guys that for awhile- hence the reason i dont post every thing about myself, or company

    best thing that i found was to have your guys sign up with a temp agancy , they pay the tax, they insure them. Your guys get paid at the end of every week , and the bill is net 30 days , so helps the cash flow out a little bit. Sometimes i give cash for bonuses. Remember you can pay cash , and just not deduct it as an expense. If you have enough deducitions and depeatations , sometimes when your small that an easy way to go -
  19. JD Dave

    JD Dave PlowSite Fanatic
    Messages: 11,194

    I support the country I live in and I don't mind paying taxes, that's why everythings through the books. People that pay cash and receive cash under the table are not people I want to deal with. Also people who bank hours in the winter and collect unemployment illegally annoy me also. JMO
  20. bigearl

    bigearl Senior Member
    Messages: 393

    Thats a good idea on the temp service, I never would have thought of that. you learnd me soumthin today