[pwgtax]

My brother worked for a company installing store fixtures around the USA. He would be told what cities to go to, what stores, when to do them. He was paid by the hour, had a company credit card for expenses, had his hotel rooms paid for and a per Diem for food. The company would rent trucks when needed for him to drive to the next job. They basically supplied everything for him to do his job and they kept all the receipts for his job related expenses.

Last year his boss told him to get a business account at the bank and he just 1099'd him for almost 30,000. He has no receipts for deductions since the company paid for everything.

I guess my question is, is he an employee or independent contractor? What can he do as far as the IRS?

Thanks

[Fr_Chuck]

The company is considering him a contractor since they paid him by a 1099, and I guess he agreed to be that since he allowed them to do it.

Of course at 30,000 he was really only making about 21,000 since anyone on a 1099 basis needs to set aside from 30 to 40 percent of their income for taxes.

Sounds like this company figured a way to cheat him and pay him a lot less than they were paying. Plus as a contracter he is not covered for unemployment or workers comp either.

[AtlantaTaxExpert]

Yes, Fr Chuck covers it quite well.

Your brother should find another job, from an employer who does screw over their employees.