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Hello everyone, if I hire a csr at my agency can I put them on a 1099 or do I have to put them on a w2 in Florida? What about a 2-20 or 20-44 licensed agent?

You can do anything you want - but the IRS etc. will want their piece of the action - so to speak. Even commission has to have withholding taken out. You will probably find that to 1099 you cannot dictate hours - so if they want to come in and work at their leasure as long as they meet their contract you cannot have control. Just easier and safer to W-2 these days. Paying back taxes in event of an audit is not worth it. We had the unemployment dept. from the state do an audit and yep they got us on the commissions as well as one of the partners - who is retired - had to pay taxes on money he received from the corporation.

You have to go the the IRS website and look at the requirements for an independent contractor that you would issue a 1099 for. It is very specific, and if that person is only working for you and you provide their work space, etc, then they are considered an employee, even if it is part time. Generally speaking, issuing a W-2 is probably the answer if the csr is only doing that type of job for you and not other agencies in a truly independent manner. A CSR on a 1099 is quite a stretch, I believe. Sales people can be independent if they are brokering, working from home, paying their own expenses, etc. There are penalties involved if you put someone on a 1099 and then the IRS determines them to be an employee, I believe, so makes it even worse.

Hi John, you will very likely need to have all CSRs setup as an employee regardless of firm size and state. I use a payrolling service who is the employer of record for my firm - this way I am not the employer and fully compliant. Hope that helps.