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when you hire an employee and they want you to give them a

Customer Question
1099 what taxes do you...
when you hire an employee and they want you to give them a 1099 what taxes do you take out of their pay and can they file for unemployment?
Submitted: 7 years ago.Category: Tax
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6/3/2010
Tax Professional: RD, Certified Public Accountant (CPA) replied 7 years ago
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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If the employee is an independent contractor than you would not withhold any taxes from the payments made to them. The contractors are responsible for the self employment tax and federal withholding.

Please note that you need to have a clear independent contractor and not an employer employee relationship.
Here is a link providing more detail on such determination-

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

Let me know if you have any question.

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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