Subcontractor vs. Employee: How to Determine Who Gets a 1099

Border 2

With the end of the year approaching, it is time to think about who you are paying and year end reporting.

Deciding whether a worker is an employee or a subcontractor is largely a question of who determines how the work gets done:

  • If you (the employer) determines – then you probably have an employee. You tell the employee where, when, and how to complete the work.
  • If the worker determines – then you probably have a subcontractor. The contractor completes the project per your specifications, but does so by their schedule, has their own tools, and most likely does the same kind of work for others.Once you decided that you have a subcontractor working for you, how do you determine who needs a 1099? When you hire an individual or business under contract, you should give the contractor a Form W-9. This will provide you with their entity type and other pertinent information. In general, a 1099 should be prepared for any individual or unincorporated business that is paid $600 or more during the calendar year.

Proceed with caution when deciding whether to classify a worker as a subcontractor or an employee. Misclassifying has financial and tax implications for you (penalties for failing to pay employment taxes and/or for failing to file required tax forms).

Please call us at (503) 362-9152 if you need help with this

Corporate Coffee of Oregon: They Are Our Kids!

We will be closed on Monday, September 4 for Labor Day

We will be closed on Monday, August 21, due to the Eclipse

Border 2
With the expected high volume of people and traffic coming to Salem, we will be closed on Monday, August 21.

Corporate Coffee of Oregon: Join us at the Oregon State Fair & Expo Center!

Avoid an Audit! Learn the Upcoming Due Dates for 2018

Stay in Compliance: Oregon Minimum Wage Increases on July 1!

Corporate Coffee of Oregon: Boys & Girls Club

Corporate Coffee of Oregon: Making Motorcycle Dreams Come True!

Join us on May 18 for Corporate Coffee of Oregon. Our guest speaker is Marc Gore from Salem Harley-Davidson!

Welcome to Our New Client Portal!

Our new client portal (Share Safe) makes it easy to send and receive files securely between two parties. Unlike email, all correspondence through the portal is private. You can send up to 20 files per message, up to a limit of 1 GB total size.

Our Client Portal will change on May 1 to Share Safe. We encourage our clients to utilize the link below to send files to our staff.


Click Here to Access Share Safe

Or copy and paste this URL into your browser: