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WiseOwl58
WiseOwl58, Attorney
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I own an LLC registered in Puerto Rico and we provide services

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I own an LLC registered in Puerto Rico and we provide services to a California LLC. The client has offered me the opportunity to participate in his small business group help plan. Can I participate in his health care plan without jeopardizing my 1099 status?

If so, can you please reference the relevant tax code.
An independent contractor providing services to the client cannot participate in the small business group plan. If you do, you will fail the IRS' twenty point test for determining independent contractor status and you will lose the ability to be a 1099 consultant.

According to the IRS:

Benefits: Providing benefits other than pay are a strong indicator of employee status.
Incorporated status: Workers who are incorporated are generally considered to be working for themselves, not as your employee.

Here is a good summary of the 20 point test, FYI.

http://comptroller.illinoisstate.edu/downloads/20-factor-test-for-independent-contractors.pdf

I would suggest you not participate in the plan, as it would jeopardize your 1099 status.

Good luck to you. I wish you all the best.
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Customer: replied 4 years ago.

Rated Good Service. Thank you.

Thank you. Just let me know if you have any additional questions.

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Leon:



Please let me know if you have any other questions. Just put my name---Wise Owl 58--- in the first line and I will get it and respond.

All the best.

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