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Ray, Employment lawyer
Category: Employment Law
Satisfied Customers: 42191
Experience:  30 years in Employment law
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I work as a Travel Agent to a small travel agency. They pay

Customer Question

I work as a Travel Agent to a small travel agency. They pay me on W2 a base salary but after I was hired they to ld me that I need to open a corporation / LLC just to receive the commissions on a 1099.
My problem is that by doing that I believe my employer will be paying direct to my then “corporation” for commission derived from the vey same work Im doing under a W2 at the same time. To me that looks a little shady, I was never told to open a corporation to receive commissions aside.
I want to pay my taxes but I want my employer to pay his share as well. In my mind either he pays me on a single W-2 or a single 1099, but to have both and work as an employee and a contractor at the same time it sounds weird, furthermore, Im concerned that if he hires the “corporation” and offers me no contract that corporation also must to pay taxes, and if Im working under that corporation I also need to deduct these taxes as well, so in my vision I would be paying taxes 3 times, once from my W-2 salary, once from the 1099 as a corp to corp and again from myself to the corporation I opened.
I need to know if that is legal, and if I accept that I will have any future complications 5 to 10 years from now. I never had to open a corporation to receive commissions and really don’t want to lose my job but if that’s a bad move from my employer I would like to simply move on and not dispute anything.
Please advise,
Submitted: 1 year ago.
Category: Employment Law
Expert:  Ray replied 1 year ago.

Hi and welcome to JA. Ray here to help you tonight.

This is huey here , the employer is trying to stiff you for higher taxes.Any 1099 means you have to file self employment taxes for such commissions.Your employer needs to pay you as an employee which you are.You may decide here that you leave this employer if they will not pay you properly.

Setting up a corporation would cost you money here both in setting it up and then in taxes as a self employed individual. This is totally shady here.I would not agree to it.Long term I think you consider leaving if they are going to require this form you.Again is totally a shady thing to do, they can pay you commissions as a W-2 employee.I would not agree to this at all and if they deny you commissions file a complaint with Dept of labor.

I appreciate the chance to help you tonight.Thanks again.

Customer: replied 1 year ago.
Thank you for your assistance on the matter
Expert:  Ray replied 1 year ago.

Take care and bye.