Having written a lot of payroll programs I’m used to reading and understanding “IRS”, which makes a big difference. I also knew the constituent services people in the local Congresscritters offices, so I could get a straight answer if I didn’t understand something.
The “contractor” thing is a crap shoot if the person listed doesn’t have a separate business license. In general, you are better off using a temp agency if there is a doubt, because they always accept business-to-business as a contractor.
I don’t think its difficult, because I never had problems, but I was familiar with the environment. A lot of tech companies don’t really have a lot of business experience on staff, and that makes a huge difference when dealing with the government.
]]>My first job after teaching was with a small consulting firm that had 6 employees, and they used a similar package to the one you describe. They also ended up having to spend major money for a tax attorney after the IRS came in and did an audit after receiving a complaint that one employee was inappropriately listed as a contractor rather than as a full-time employee. (Said employee was a summer intern who was upset that he didn’t get offered a full-time job and called the IRS tax cheat reporting hotline). But I will defer to your superior knowledge of Florida here, and just note that any small business that turns over their money to somebody else better darn well know who they’re turning it over to and how reputable that “someone else” is… which, alas, is why giant companies like ADP dominate the payroll business, sigh!
– Badtux the Taxed Penguin
]]>California is a bigger challenge, but you can do it with the assistance of the software.
Oh, the Sheriff is investigating the bad checks, and the state is interested in missing taxes. It will probably end up as a fraud investigation, and the Feds will show up later to take over after all the work is done.
AES wasn’t doing anything special. They just bought the software for Florida, and had a few community college graduates to input the data. The only problem with the software is that you need the subscription to keep it updated.
]]>My guess is that the local Sheriff’s Department has a similar problem. They would need a full-time tax attorney on staff to deal with all the interactions between benefits packages and the IRS, for example, what is this year’s limit for the amount of life insurance that must be listed as a taxable benefit (and have tax withheld from the paycheck to send to the IRS as tax)? How many of their deputies have life insurance provided by the Sheriff’s Department that’s above that limit? So outsourcing to someone makes sense. But outsourcing to the lowest bid or to a campaign contributor, on the other hand… well. You need to investigate the company *before* you issue the contract for them to handle your payroll, not *after*. Just sayin’ ;).
– Badtux the Well-taxed Penguin
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