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Guillermo J. Senmartin, Esq.
Guillermo J. Senmartin, Esq., Immigration Lawyer
Category: Immigration Law
Satisfied Customers: 94359
Experience:  10+ years of experience in various aspects of U.S. Immigration Law.
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Hi, I am getting a contract opportunity in US. I am eligible

Resolved Question:

Hi,

I am getting a contract opportunity in US. I am eligible for TN Visa. My question is, if I want to do corp-to-corp, do I have to have Canadian corporation, or I can set up an US corporation and do corp-to-corp on TN Visa?
Submitted: 1 year ago.
Category: Immigration Law
Expert:  Expert James replied 1 year ago.
Hello, and thank you for your question!

Please note that I earn my living by helping customers like you. So once you've received your answer, I ask that you give me a positive rating for my customer service, so that I get credit for my work. Remember that this rating is not based on a good outcome or the state of the law, which I cannot control. If you feel the need to use "poor service" or "bad service," please ask follow-up questions instead, so that I can try to help you further.

I'm not familiar with the term "corp-to-corp." Can you please clarify what you are referring to; or alternatively, give an explanation of what you mean by corp-to-corp?
Customer: replied 1 year ago.

By corp-to-corp I am refering that instead of being a permanent employee of the US employer (being paid on W2), they want to pay to my corporation. I have got mixed information from web that this corporation that I will be setting has to be canadian corporation. In other instances I have seen people having a US corporation setup and the empoyee paying to their corporation and they draw money from their corporation in terms of salary or dividends. I want to know what is legal and what is correct. If the employer wants to pay for my corporation, does it need to be Canadian based or can be US based?

Expert:  Expert James replied 1 year ago.
Suresh,

So basically, what you are trying to do is to be a contractor for the US company?
Customer: replied 1 year ago.


Yes. It is a contract job, but full time.

Expert:  Judith replied 1 year ago.

Hello,my name isXXXXX you for this opportunity to answer your questions.

I am a new expert.

You have to have a US employer (corp) be your employer and the employer has to pay you your salary.

So you will have to establish a US corporation that will sponsor your TN and be responsible to pay you as their employee.

 

Judith

Customer: replied 1 year ago.

Hi Judith,


It means that I will be the owner of the US company that I establish and I will be the employee of the same company, that I am owner of. Isn't it considered self employment? Is it a valid setup for obtaining TN visa?


 


Thanks.


 

Expert:  Judith replied 1 year ago.

No it is not self-employment because a corporation is a separate entity. Set it up as a c corp.

Self employment would be if you were not corp to corp and the contract was in your name.

It would be advisable to have a close friend or relative named as say Managing Director who would have authorization to sign the offer letter that you need for the TN at the border. That way you are not signing your own employment letter.

In addition, it is also advisable to have the corporation's contract with you when you apply for the TN to show that there is work for you since it is a newly formed entity.

Judith

Customer: replied 1 year ago.


But if I am forming company, if I am the Director of Company and I am employing myself, it does feel like self employment.



Where as if the contract is directly under my name, it means the recruiter company is hiring me, he is my employer, i.e. I am not self employed.


 


I am confused as what you are explaining is opposit of what I have read so far. Please dont mind, but can you clarify more?


 


Also, if I get TN and then set up US company and did corp to corp, would I have issues during TN renewal?

Customer: replied 1 year ago.
Relist: Other.
Need clearer answer.
Expert:  Judith replied 1 year ago.

I am happy to clarify but this has me confused! Are you saying if you get a contract in your name that is not self employment?????

 

Where as if the contract is directly under my name, it means the recruiter company is hiring me, he is my employer, i.e. I am not self employed.

Customer: replied 1 year ago.


Thats correct. If the recruiting company is hiring me, i.e. making contract with me directly, I am an employee and his company is employer.


 


Whereas if he is making contract with the company that I have set up, then I am employee of my own company, because my company is separate entity and pays me. --> self employment.

Expert:  Judith replied 1 year ago.

No, this is where you are confused about "self-employment". Self employment under US law is where you yourself pay all your taxes, social security, etc.

Here is the IRS definition

(An employer) must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. You do not generally have to withhold or pay any taxes on payments to independent contractors.

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-(Self-Employed)-or-Employee%3F

 

If you are working for a corporation it is a separate entity, it is not part of yourself, but it is like another person. That is the best way I can describe it to you. It is not you.

If you do not declare the income of the business on your personal tax return and the corporation pays their share of all taxes and pays you a salary which you declare and pay income tax on, then you are not self employed. You are an employee.

It doesn't matter that you own the shares of the corporation.

The only disadvantage to this is double taxation. The corporation pays income tax on earnings and you pay taxes on your salary! But that is corp to corp. And the only way for you to get a TN unless you work as a management consultant.

I know this law well. In my 34 years as a business immigration attorney I have done many of these arrangements for TNs.

Judith

 

Expert:  Judith replied 1 year ago.
Do you have further follow-up questions? I have had 34 years experience doing business immigration law and this is not an unusual situation. I have given you supporting information from the Internal Revenue Service which describes self-employment/independent contractor situations and it verifies what I have told you.
Judith
Customer: replied 1 year ago.


Hi Judith,


 


I want to know, who should write me a TN Support letter.


 


I will be working for one assigned client. This client will pay the money to recruiting agency and recruiting agency will pay it to my corporation.


 


My questions are


1. who should write me TN letter the client or the recruiting agency?


2. Me being paid on per hour basis, is it a red flag for TN?


 


 

Expert:  Judith replied 1 year ago.
WHO IS PAYING YOU???????? Who is paying you your wages you earn from the project?
You must earn a wage - who is paying you your hourly wage???

Judith
Customer: replied 1 year ago.

Okay the payment structure is like this:


 


Client pays the recruiting agency


Recruiting Agency pays to my US Corp or Sole proprietorship


My US corp/ Sole proprietorship pays me

Expert:  Judith replied 1 year ago.
Precisely. I am trying to make it clear to you. I understand that and that is why I have told you all along that it is the US corp that has to write the support letter.
They are your employer.
I have gone through how this is a separate entity. I have given you the IRS rules. The corp is not you. The corp is a separate and distinct entity that is NOT you even if you own the stock.
It is the corporation that will give the support letter.
Judith
Customer: replied 1 year ago.

My own US corporation cannot sponsor me, me being the owner myself. If this was the case, anybody will setup an US corp and sponsor themselves for TN. This is not allowed.


 


It has to be either the recruiting company or the client. My question is who?

Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.

Hello. Where is the confusion that you are having? You have opted out two experts which means that neither can respond to you. We don't have many experts left with the type of knowledge that you are looking for. Did you accidentally opt them out?

Customer: replied 1 year ago.


Hi,


 


You can review the questions and answers above, but the situation is simple.


 


I am planning to obtain TN visa.


 


I am setting up US corp, say corp MyCorp.


 


Client will pay my recruiter and recruiter will pay MyCorp. I, as an individual will get paid by MyCorp.



My question is who should provide me the TN sponsor letter? Client or Recruiter?

Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.

Ok. Is there any particular reason why you want to create this entity?

Customer: replied 1 year ago.
My recruiter wants to pay me on1099 instead of w2, that way he doesn't have to pay Medicare and FICA. That is the offer . He will pay me through my corp instead of making me his employee
Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.
Ok. I understand now. The recruitment company is your employer, not the client. The work-site employer must be listed on the documentation along with the work site location. The recruitment company issues the letter of employment and salary requirements, etc. Incorporation is not necessary for a 1099. In fact, you incorporating would muddy the waters and could result in an investigation of your case and denial of your status, at least in my opinion. With the bad economy, high unemployment in the U.S. and many U.S. workers looking for jobs, I would keep it simple and straight with USCIS. Don't try to do what I like to call "legal gymnastics". This way you are safe. Please let me know if you have additional questions and please do not forget to rate my service to you (not the state of the law) as that is the only way that I can get credit for my assistance. Even after you rate the service, I can still answer additional questions for you without additional charge. If you do rate me positively, a bonus is always appreciated. If you would like to request me in the future, just go to http://www.justanswer.com/law/expert-guillermosenmartin/. Thank you!
Customer: replied 1 year ago.

Hi Guillermo,


 


Thanks for your answer. It clarifies things, but are you saying that I can get paid by the recruitment company on 1099 without having to incorp? If so, can you please tell me how can I do that? Is sole proprietorship a way, or it is still the same as corp?


 


Thanks.

Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.
Yes. Sole proprietorship could be a way. Or you just receive it as an individual. This is permissible. Please let me know if you have additional questions and please do not forget to rate my service to you (not the state of the law) as that is the only way that I can get credit for my assistance. Even after you rate the service, I can still answer additional questions for you without additional charge. And don't forget that bonuses are always appreciated! Thank you.
Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.
Hello. I'm just following up with you to see how everything is going. Did my answer help? Please let me know. Thank you!
Customer: replied 1 year ago.
Thanks . One last question , I will paid on hourly basis, does this affect my TN Visa chances?
Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.

No, it does not. All that is required is that arrangements for remuneration for services to be rendered be made.

 

Take a look at this link on the 4th page:

 

http://www.tnvisabulletin.com/tn-visa-status-law-regulation/b-regulations/8%20CFR%20214.6%2001-01-2010.pdf

 

So no, an hourly rate will not affect you receiving a TN.


Please let me know if you have additional questions and please do not forget to rate my service to you (not the state of the law) as that is the only way that I can get credit for my assistance. Even after you rate the service, I can still answer additional questions for you without additional charge. And don't forget that bonuses are always appreciated! Thank you.

Guillermo J. Senmartin, Esq., Immigration Lawyer
Category: Immigration Law
Satisfied Customers: 94359
Experience: 10+ years of experience in various aspects of U.S. Immigration Law.
Guillermo J. Senmartin, Esq. and other Immigration Law Specialists are ready to help you
Customer: replied 1 year ago.

Thanks for your answers Guillermo. I was wondering will you be able to provide me with a sample TN letter with hourly pay and close to my situation (letter from a recruiter)?

Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.
Unfortunately, that is not something that we can provide for you, but it does not have to be overly complicated.
Customer: replied 1 year ago.

Thats fine. Thanks for your answers !!

Expert:  Guillermo J. Senmartin, Esq. replied 1 year ago.
You are very welcome. Good luck to you!

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