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What is the Difference Between a 1099 and a W-2?

The Form 1099 from the IRS is a federal tax information form which reports all earnings and proceeds other than wages and salaries. Typically, these forms are used when an independent contractor is receiving payment for his/her services. Most often, independent contractors choose their clients, determine their payment, control their work hours, and are their own boss. At PereGonza The Attorneys, we’ve experienced clients who are registered as independent contractors but are mandated to work certain hours. If you’re a registered independent contractor but are being treated as an employee you are being misclassified by your employer. If so, please fill out your information below to schedule a free consultation with our experienced Miami employment lawyers.

A W-2 is a wage and tax statement used to document the taxes removed by employers from an employees paychecks. With that being said W-2 forms are legal proof that employers are paying certain employment taxes and labor costs. Typically when an employer has an employee under a W-2 they have to pay certain taxes and labor costs. To cut costs, many employers choose to pay their employees, under a 1099, as if they were general contractors. Our Miami employment lawyers will tell you general contractors can chose when they work and for whom; so if you don’t make these decisions odds are you are an employee. You’ll know if you are an employee if your boss makes your schedule, determines your pay, or assigns you a uniform.

Why do Employers Misclassify Employees?

The law determines whether someone is an independent contractor or an employee, not an employer. Our Miami employment lawyers have seen many employers classify their employees under a 1099 to save money. One of the main benefits employers receive is not being able to follow labor laws, which includes laws on minimum wage. Many employers also fail to pay workers properly for their overtime. Florida overtime laws state any hours worked over 40 hours per week must be paid at 1.5 times their regular rate. However, if you are being paid under a 1099 your employer isn’t required to pay you at this rate. Our Miami employment lawyers want you to make sure which form your employer is using to pay you; either W-2 or 1099. If you are being treated as an employee but being paid as a general contractor you may have a very good case.

At PereGonza The Attorneys, our experienced Miami employment lawyers recommend you seek immediate legal advice if you feel misclassified. We offer free consultations and case evaluations to ensure you are being paid the fair wages you deserve.


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