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Updated over 11 years ago,

Account Closed
  • Stafford, TX
0
Votes |
10
Posts

Flipping Houses- Hiring Employees..HELP!

Account Closed
  • Stafford, TX
Posted

Hello all. I live in Texas and am a newbie in the real estate investment business.
I formed an LLC to put all the investment properties under. I have my first foreclosure under contract and close on it next week.

I really need help from a flipper/rehabber who has knowledge about the process of hiring employees. I know a lot of investors who pay cash to their day laborers/independent contractors for a variety of reasons and I'm assuming you know why too...

My CPA told me this can get you in some serious high water with the IRS if you do not report the wages you are paying out. She suggested I have all my day laborers who are not independent contractors fill out a W-2 form and pay them by payroll. She suggested I have all the independent contractors supply me with a social, TIN # or EIN # in order to submit a 1099-MISC to the IRS at the end of the year and pay them by certified check.

But what if I only use a day laborer for let's say 3 days? Why would I formally employ them?

Does anyone have any suggestions/comments or a better method for this situation?

Any help would be greatly appreciated!!

Thanks,
T&B Realty of Texas, LLC

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