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California - Unemployment 1099 vs. W2

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  • California - Unemployment 1099 vs. W2

    Help... I think I made a mistake.
    I hired a new employee. They worked one shift and quit. They said, "it wasn't for them."
    Instead of going thru the hassle of putting them on payroll, I just gave them a check for the gross amount.

    Now I received a voicemail message from the Labor Dept wanting to verify employment because they filed for unemployment.
    Am I going to get in trouble for treating them as a 1099 employee instead of a W2? The total payout was $168.00.

    What should I do?

  • #2
    Did you have them fill out any paperwork at all? If so, what?


    • #3
      How long ago was the shift they worked?
      Do you have the preemployment paperwork (W2, State tax, etc. needed to set them up in payroll)

      If so, what I would honestly do, is set them up and run the $168 payment. If possible, back date it, but ONLY if you have not yet filed ANY tax returns (including state, local, etc.) for that payroll period. If not, run it as of today's date. Then do everything with the payroll taxes as normal and writeoff the net amount of the check against the $168 you already paid. You will have to pay the employee's share of the taxes yourself, but that's a very minor amount of money on $168...much less than any errors that might make the DOL or the IRS or your state start knocking on your door.


      • #4
        I do have the preemployment paperwork.. She worked two days. Total for 16 hours at $10.50 an hour. I'll check and see if I submitted taxes for that period yet. Thx