Pod Tutor--Independent Contractor or Employee

[Anonymous]

Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

[Anonymous]

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

[Anonymous]

Spell it out in a short contract. Ensure that it’s structured according to your desired alternative.

[Anonymous]

Whether you owe employment taxes depends on the nature of their work and your supervisory responsibility, you can’t just decide to call them independent contractors and not pay employment taxes.

[Anonymous]

I'm looking at this also since we have four families who retained a tutor for 5 kids. We thought it was pretty clear that the tutor was a 'household employee' since her hours are restricted by our requirement.

[Anonymous]

My spouse is being paid as a 1099 contractor as a pod instructor. He will pay SE tax on all that income (in addition to Fed and State tax, of course.)

[Anonymous]

Under common law, a worker who performs services for you is your employee if you can control the work schedule, what will be done and how it will be done. It does not matter whether you give your nanny or caregiver great latitude, but rather that you have the right to control the work. It does not matter if the work is performed on a full time or part time basis. It does not matter whether the worker lives with you or not. It does not matter if he/she is paid hourly, daily or a salary. It does not matter how the employee refers to herself or how you refer to him/her in an employment contract. The IRS articulates strict guidelines that differentiate employees and independent contractors to further eliminate confusion (Refer to IRS Publication 926).

https://www.homeworksolutions.com/knowledge-center/nanny-independent-contractor/

See also:
https://www.irs.gov/newsroom/understanding-employee-vs-contractor-designation

[Anonymous]

So possibly need workers comp, and you should confirm your homeowners will cover certain potential claims.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

This. It’s not an either/or...just pick whatever. Presumably the schedule is generally set. My mowers come anytime bw 7-10 days in bw mows. Is your pod tutor coming anytime on Tuesday for 2 hours or Tuesdays for 2 hours at designated times?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

Whatever, weirdo.

[Anonymous]

Anonymous wrote:I'm looking at this also since we have four families who retained a tutor for 5 kids. We thought it was pretty clear that the tutor was a 'household employee' since her hours are restricted by our requirement.

You could go that way, but there's a whole form on the IRS's website that will help someone determine if they're an employee - the restriction of hours is just one of like 20 questions.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

Whatever, weirdo.

New poster here: she’s right though and you’re wrong.

In general:
A pod teacher will likely be your employee if you provide the guidelines for instruction and set the hours and days the instructor works. The teacher could be considered an independent contractor if they have set up their own business and have multiple learning pods AND you need to work around the teacher’s availability AND have little input into the curriculum and daily schedule of your children. The instructor would provide everything they need for the care and learning of your children.

I think nearly all learning pod teachers are employees. How many do you think are told to set their own hours?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

Whatever, weirdo.

New poster here: she’s right though and you’re wrong.

In general:
A pod teacher will likely be your employee if you provide the guidelines for instruction and set the hours and days the instructor works. The teacher could be considered an independent contractor if they have set up their own business and have multiple learning pods AND you need to work around the teacher’s availability AND have little input into the curriculum and daily schedule of your children. The instructor would provide everything they need for the care and learning of your children.

I think nearly all learning pod teachers are employees. How many do you think are told to set their own hours?

It's not just about setting of the hours though. It's that three category test that the IRS has--Behavior Control, Financial Control and Relationship of Parties. I think most tutors in pods will be vetted against the Financial Control and Relation distinctions. Our pod tutor does not accrue any benefits, typically those afforded to a nanny such as vacation pay or sick leave. Our pod tutor is not paid for any days we do not hold the pod, or if she is sick, or if we dismiss her early because it's an early dismissal day. Also, under the "permanency" test, our pod tutor is not guaranteed 'indefinite' employment--in fact, it is for a specific duration (until schools open partially or fully). Even if schools were to open partially, we would ask her not to come on the days that the kids will be in school. And, we would not pay her for those days. And, she is free to have other employment when she isn't providing services to us. Obviously we can file the SS-8 and get IRS's interpretation of the specific situation, but I don't know why it would be out of the ordinary to expect that the tutor cover their SE taxes, while we provide a 1099. Seems pretty legit to me.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Wondering whether there are any tax attorneys or CPAs who are looking into this. Google says 'yes and no' and all the grey in between, but wondering if there's something definitive to rely on for VA residents. Thank you!

I say independent contractor that way you don't need to cover their employment taxes, they pay their own self-employment taxes.

Please do not ever again give advice on this subject to anyone.

Whatever, weirdo.

New poster here: she’s right though and you’re wrong.

In general:
A pod teacher will likely be your employee if you provide the guidelines for instruction and set the hours and days the instructor works. The teacher could be considered an independent contractor if they have set up their own business and have multiple learning pods AND you need to work around the teacher’s availability AND have little input into the curriculum and daily schedule of your children. The instructor would provide everything they need for the care and learning of your children.

I think nearly all learning pod teachers are employees. How many do you think are told to set their own hours?

It's not just about setting of the hours though. It's that three category test that the IRS has--Behavior Control, Financial Control and Relationship of Parties. I think most tutors in pods will be vetted against the Financial Control and Relation distinctions. Our pod tutor does not accrue any benefits, typically those afforded to a nanny such as vacation pay or sick leave. Our pod tutor is not paid for any days we do not hold the pod, or if she is sick, or if we dismiss her early because it's an early dismissal day. Also, under the "permanency" test, our pod tutor is not guaranteed 'indefinite' employment--in fact, it is for a specific duration (until schools open partially or fully). Even if schools were to open partially, we would ask her not to come on the days that the kids will be in school. And, we would not pay her for those days. And, she is free to have other employment when she isn't providing services to us. Obviously we can file the SS-8 and get IRS's interpretation of the specific situation, but I don't know why it would be out of the ordinary to expect that the tutor cover their SE taxes, while we provide a 1099. Seems pretty legit to me.

All of this is very true! It isn't all about the fixed hours, there are multiple criteria to look at.