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Other Added - How To Toe The Line When Hiring Independent Contractors And Reap Big Dividends
Branding is an application of appropriate marketing techniques in the right proportion to a product. Brand management is to manage the forces in a market suitably to win favors for the product.Branding essentially has to work on both mind and heart of consumers so that the product's perceived value to the customer increases and thereby increase brand equity.Marketers see a brand as an implied promise that the level of quality, people have come to expect from a brand will continue with present and future purchases of the same product. There are a lot of products available but limited brands. Its comparatively easier to judge the needs of people and develop a product accordingly, but it is tough to tell the world that there exists an answer with you to their needs. Its not hard to sell some one what he wants, but its hard to make him aware about the availability.Brand your products in a way to generate sales and also a good will in the market. Use the mixes in a way that at one end the consumer feels that he needs your product and at the other he feels that's its in his betterment that he is associated with your product.
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits
The IRS is very strict on payroll tax and the deductions associated with it. Even a small miscalculation can land an organization in serious trouble with this regulatory authority. So, it is important to maintain careful records of payroll accounts in an organization.The first step to calculating payroll tax is getting each and employee to fill up the W-4 form from the Internal Revenue Service. This form aims to calculate the payroll tax depending on the marital status of an employee and the number of dependants. Since most states have payroll structures that are based on the federal system formulated by the IRS, this form helps organizations calculate the payroll tax withholding for both federal and state governments.Currently, the social security tax withheld from an employee's wages is calculated as 6.2% of total salary. This same amount has to be contributed by the employer, and added to the payroll account of the organization. The wage base for this tax is $76,000 dollars a year, beyond that, taxes need not be deducted from the employee. The same procedure is followed for Medicare taxes, calculated at 1.45% of the employees' salary. There is no wage base for Medicare taxes, and the employee and the employer goes on paying the tax independent of the salary of the employee. The Federal Unemployment Taxes (FUTA) is also calculated at 6.2%, but an employer can take credit up to 5.4%. The FUTA wage base is $7,000 dollars; an employee whose wages exceed this amount in a year, stops paying FUTA taxes that year. The same rules are applicable to State Unemployment Tax
The phrase Toe the Line is an Americanism first recorded in the early nineteenth century. The main meaning of this phrase is 'to conform strictly to a rule, command, etc... For example, "Anyone who doesn't toe the line can expect to meet the mayor in court, where, as it turns out, he has never lost a suit." (U.S. News & World Report, 1996).
And...
An Independent Contractor is a person hired to work for others without having the legal status of an employee.
Hiring someone who qualifies as an Independent Contractor can provide an employer with some very BIG dividends...
Dividend #1: You don't have to pay the employers share of the workers Social Security and Medicare taxes.
Dividend #2: You don't have to withhold income taxes (federal or state) on his/her earnings.
Dividend #3: Not only do you reduce your bookkeeping and financial obligations, you're not bound by many of the federal and state laws that normally govern the employer - employee relationship.
Dividend #4: You don't have to provide office or other work space for the worker.
Dividend #5: You don't have to provide fringe benefits (vacation, personal or sick time).
Dividend #6: You don't have to provide health insurance or retirement benefits.
Dividend #7: If you become unhappy with the person's work, you can fire him/her without going through the trauma often associated with firing an employee. Plus you don't get stuck paying unemployment benefits.
All you're required to do is inform the IRS if you paid this worker more than $600 in one year.
You're responsible for filing a Form 1099-MISC at the end of the year if you paid the Independent Contractor $600 or more during the year. This form is sent to both the IRS and the contractor.
There are some basic qualification and guidelines you'll have to follow when classifying someone as an Independent Contractor. As long as you make sure you meet these specifications, you won't be challenged by the IRS.
A "No Sweat" Classification
It must be clear the contractor is in business for himself. The following characteristics guarantee you a "no sweat" Independent Contractor classification.
The worker is available to perform services for many businesses.
The worker has a fixed base of operation - a commercial or office location or a room at home and ongoing business expenses.
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits o
Customer relationship management, or CRM, refers to reliable systems, processes, and procedures that allow companies to better manage customer relationships. It is a corporate level strategy that focuses on creating and maintaining effective communication with its customers. Ideally, a sound CRM strategy should develop an end-to-end process that encompasses sales, customer service, and marketing.A successful customer relationship plan can manage all business-related operations and interactions with customers simultaneously. It often includes special software programs, called CRM programs, which aid companies in tracking and organizing their customer base.Customer relationship management is just that: learning ways to manage the happiness of your customers by giving them what they want, increasing the effectiveness and profitability of your product or service by adapting them to customer preferences, and creating communication channels between sales reps, sales managers, and the customers they serve.What are some ideas for successfully implementing a customer relationship management strategy?There are numerous ways to successfully implement an effective CRM program. Here are some ideas that will start you thinking about the ways you can create a richer and more truly customer based culture. You can improve, adapt and reform your customer relationship plan by such methods as: Providing product information and support via a hotline or a website. This would allow customers to better use and understand specific products or services, and get any te
Dividend #1: You don't have to pay the employers share of the workers Social Security and Medicare taxes.
Dividend #2: You don't have to withhold income taxes (federal or state) on his/her earnings.
Dividend #3: Not only do you reduce your bookkeeping and financial obligations, you're not bound by many of the federal and state laws that normally govern the employer - employee relationship.
Dividend #4: You don't have to provide office or other work space for the worker.
Dividend #5: You don't have to provide fringe benefits (vacation, personal or sick time).
Dividend #6: You don't have to provide health insurance or retirement benefits.
Dividend #7: If you become unhappy with the person's work, you can fire him/her without going through the trauma often associated with firing an employee. Plus you don't get stuck paying unemployment benefits.
All you're required to do is inform the IRS if you paid this worker more than $600 in one year.
You're responsible for filing a Form 1099-MISC at the end of the year if you paid the Independent Contractor $600 or more during the year. This form is sent to both the IRS and the contractor.
There are some basic qualification and guidelines you'll have to follow when classifying someone as an Independent Contractor. As long as you make sure you meet these specifications, you won't be challenged by the IRS.
A "No Sweat" Classification
It must be clear the contractor is in business for himself. The following characteristics guarantee you a "no sweat" Independent Contractor classification.
The worker is available to perform services for many businesses.
The worker has a fixed base of operation - a commercial or office location or a room at home and ongoing business expenses.
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits
2005 proved to be a very good year for the rental industry. Several companies showed record earnings and revenues last year. Caterpillar, H&E, Ingersoll-Rand, and JLG were among the leaders in earnings.Caterpillar, Peoria, IL, had record profits and revenues in the third quarter. With revenues of $8.98 billion and profit of $667 million both numbers were up dramatically from the 2004 year. Caterpillar attributed the growth to strong global demand and improved pricing.H&E Equipment out of Baton Rouge, LA had a very strong third quarter as well. Their gross profit rose to $13.4 million, an increase of 40.1 percent from the year before. They also had a revenue increase of 22.7 percent to $27.5 million that quarter.Ingersoll-Rand, Annadale, NJ showed an increase of 10 percent in the third quarter to $2.6 billion. This was led by growth in their compact vehicle technologies, construction technologies, industrial technologies, and security technologies. There was also an increase in their parts, service, attachments, rental and used equipment sections.JLG Industries, McConnellsburg, PA had a record fourth quarter as well. With a sales increase nationally of 33 percent and 36 percent internationally JLG showed a 34 percent increase in over all revenue.Financial forecasts were upbeat and hopeful for this year as well. Equipment prices will be higher this year due to higher material and transportation costs, but the demand for renal equipment should not change.
Dividend #6: You don't have to provide health insurance or retirement benefits.
Dividend #7: If you become unhappy with the person's work, you can fire him/her without going through the trauma often associated with firing an employee. Plus you don't get stuck paying unemployment benefits.
All you're required to do is inform the IRS if you paid this worker more than $600 in one year.
You're responsible for filing a Form 1099-MISC at the end of the year if you paid the Independent Contractor $600 or more during the year. This form is sent to both the IRS and the contractor.
There are some basic qualification and guidelines you'll have to follow when classifying someone as an Independent Contractor. As long as you make sure you meet these specifications, you won't be challenged by the IRS.
A "No Sweat" Classification
It must be clear the contractor is in business for himself. The following characteristics guarantee you a "no sweat" Independent Contractor classification.
The worker is available to perform services for many businesses.
The worker has a fixed base of operation - a commercial or office location or a room at home and ongoing business expenses.
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits
T h e U l t i m a t u mA couple of months ago, Marc (name changed), a manager in his early 40s, called me and said: "I need your help! My superiors told me today that I get another 6-week trial period and if by then I can't show a good performance, I will be fired."He sounded quite panicky and outraged, which is not surprising in such a situation. First, I helped him to calm down so that he would be able to think clearly and rationally.Typically, my clients get coached 2 to 4 times per month. However, as this was a true emergency case, we decided to set up 2 coaching sessions per week for the first 3 weeks and then review the situation again.It turned out that he started this job less than 6 months ago and that in the first 2 to 3 months, everything seemed to develop well. And then all of a sudden, according to him, everything turned against him:* His boss stopped communicating properly with him, bypassed him time and again, and even annulled orders that Marc had given to his staff, thus completely eroding Marc's authority in his department.* His staff expressed deep dissatisfaction to Marc's boss, who was the interims manager of this department for almost a year before Marc came on board. They complained about Marc's lack of technical competence and his leadership style.* Colleagues from other departments became more and more skeptical about his competence and ability to perform the job, being reflected in the style of the internal communication (He showed me email where colleagues wrote things like " when will you ever unders
There are some basic qualification and guidelines you'll have to follow when classifying someone as an Independent Contractor. As long as you make sure you meet these specifications, you won't be challenged by the IRS.
A "No Sweat" Classification
It must be clear the contractor is in business for himself. The following characteristics guarantee you a "no sweat" Independent Contractor classification.
The worker is available to perform services for many businesses.
The worker has a fixed base of operation - a commercial or office location or a room at home and ongoing business expenses.
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits
Saturday, April 1st is April Fools Day. April Fools' Day, sometimes called All Fools' Day, is one of the most light-hearted days of the year. Its origins are uncertain. Some see it as a celebration related to the turn of the seasons, while others believe it stems from the adoption of a new calendar.Depending upon how you look at it, you are either the mastermind of pranks or the butt of corny jokes. Ignore those and think that more importantly, April Fools Day presents an opportunity to maximize your personal advantage in the workplace and capitalize on a promotional opportunity with your clients. Take advantage of the chance to play a joke. (Just make sure the joke its not at someone else's expense.) When was the last time you had a good laugh? I know I can use a more humor in my life.Think of someone you know who really needs to lighten up or simply isn't any fun anymore. What could you do that would make their week more enjoyable? Do you know someone whose door you have been trying to open? Send them a clever, yet funny, phone or email message. I'm not talking about playing jokes now. I'm talking about brightening someone's day with a chuckle or an interesting tidbit.You need to be professional about this. You can capture someone's attention but you don't want to sound like a numbskull in the process. I'm not advocating the wholesale email of the current round of hot jokes either. That's annoying and not at all funny. A funny or clever card will suffice. Peruse what is available either online or at the card store. Pick something appropriate for that pe
He or she lists the business in the phone book or through newspaper ads, radio commercials, circulars, or other advertising media.
He or she undertakes a job based on the results the client wants, but remains free to decide how to get the job done.
The worker hires and pays for assistants, as needed.
He/she has invested significant money in the business for equipment, vehicles and supplies.
Depending on how his business goes, the worker may earn large profits, small profits or none at all --- perhaps even suffers a loss.
He/she incurs expenses in doing a job that won't be reimbursed by the client.
Be very careful you don't cross the line between Independent Contractor and Employee
If the work arrangement shares some characteristics of an employment relationship and some characteristics of the Independent Contractor, you are at risk with the IRS. To ensure you don't invite an IRS audit there are two safe solutions to avoid crossing this somewhat ambiguous line.
Treat the worker as an employee. If you want to be safe and avoid any risk the IRS or any other government agency might determine you've mistakenly classified a worker as an Independent Contractor, follow the policy of always treating the worker as an employee.
Just remember, by doing this you and the worker will lose the advantages of the Independent Contractor relationship.
Require the worker to incorporate. The IRS will almost always treat this as a valid arrangement and accept the fact that the worker isn't your employee but an employee of his or her own corporation. It's legal in every state to form one-person corporations and the process can be simple and relatively inexpensive to do.
Here's how it would work...
First, the worker forms a corporation under state law and obtains an Employer Identification number from the IRS.
Second, you sign a contract with the corporation. The corporation agrees to provide specified services for your business.
Third, the corporation hires the worker (who owns the corporate shares) as an employee to perform services required by your contract with the corporation.
Fourth, the corporation bills you as services are performed for your business under the contract.
Fifth, you pay the corporation...not the employee...for the services billed to your business.
Sixth, each time the corporation issues a paycheck to its employee, the corporation withholds federal income taxes, along with the employee's share of Social Security and Medicare taxes. Periodically the corporation (using its own Employer Identification number) pays the IRS the withheld taxes along with the employer's share of Social Security and Medicare taxes.
Accept a Measure of Risk.
If treating the worker as an employee or requiring the worker to incorporate aren't practical, then you need to understand you're opening yourself up to some legal risk. One way to reduce this risk is to get professional advice. See a tax
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