Independent Contractor?

[lcdancesport]

I couldn't find a thread related to my situation so here it is: I'm working at a studio (non-franchised but now turning franchised) on base salary, as an office manager/instructor. I am not receiving commission, yet. I was an independent instructor at another studio, but decided to work at this studio for more training and experience being a manager. As an independent instructor I was able to use my floor fees as a deduction on taxes. My employer has not withheld any taxes and I was stuck with a large balance once I filed, this was after I deducted everything I could. I told one of the bosses, the one who handles finances and payroll, this isn't going to work because I don't have anything to deduct (this was months before filing). I was told they were going to talk to their accountant to see how I could make deductions. So is this a costly mistake or should I find a way to make the studio pay? I asked for a contract before joining the studio, but was told I'd be on base pay then my performance would be evaluated and I could negotiate a salary and commission. I want to fix the situation without making things ugly. I feel I have been screwed for listening to them. I should mention I moved across the country for this job.

[pygmalion]

I'm not sure I understand. The studio said they would designate you as an independent contractor but didn't, and now you're left holding the bag, tax-wise?

[lcdancesport]

They didn't say I'd be independent, they offered me a position being an office manager and instructor. Before that I was teaching independently somewhere else.

[pygmalion]

Oh. Thanks. Now I understand.

It sounds like they misled you (perhaps unintentionally) in order to get you to work for them.

[wooh]

Not "independent instructor" but were you told you'd be an "independent contractor"? As in, did you know they weren't deducting taxes from your paychecks?
I'm thinking this is less of a "dance" question and more something you should consult a tax professional about.

[pygmalion]

Or a lawyer. Aren't employers, even small business owners, required to deduct SSI,federal taxes, etc? I could be wrong, but I thought so. :-?

[lcdancesport]

They didn't say I'd be independent, I assumed I was staff since they brought me on as an office manager and instructor. Being on base pay is a salary, which again, thought I was an employee. The strange thing is, I swear I filled out a W-2 when I came down there, but it was never filed. I knew they weren't taking out taxes, but my concerns weren't really heard. I was just told they would help me out when it came time to file and they would find deductions. Yeah, that never happened.

[lcdancesport]

Not "independent instructor" but were you told you'd be an "independent contractor"? As in, did you know they weren't deducting taxes from your paychecks?
I'm thinking this is less of a "dance" question and more something you should consult a tax professional about.

I wanted to get a dance instructor's perspective too. I have contacted several other professionals on a tax and legal level to see what's going on. Again, not trying to stir things up, just looking to correct what may be wrong.

[Peaches]

Or a lawyer. Aren't employers, even small business owners, required to deduct SSI,federal taxes, etc? I could be wrong, but I thought so. :-?
AFAIK (and I am not saying this as a tax professional), business size doesn't have a lot to do with it. The question is if someone is hired as an independent contractor, in which case AFAIK the employer does not need to withhold, or as a direct employee of the company, in which case they do.

[pygmalion]

Yikes! So this business (seemingly) hid behind a technicality?

[lcdancesport]

Yikes! So this business (seemingly) hid behind a technicality?

In my opinion, most likely. Whether it was intentional or not, I'm not sure. I have a feeling, actually no, I know this was done with previous employers. I'm just disappointed I moved for this opportunity. I should have kept on demanding for an agreement before committing. I was just told over and over I need to be evaluated first but I'd start on a base salary. I didn't think it would be part of my responsibility to tell my boss how to properly file employment forms... but apparently it is now.

[pygmalion]

I am so sorry.

[lcdancesport]

I am so sorry.

Thanks Pygmalion. I'm not going to name names, I just want to fix this without having to pay for their problem, which is now my problem. I'm a nice, honest, hard working instructor. I love this industry, but you have to be careful who you work for and trust... I just want to earn a living and share my love of dance with others without jumping through crazy hoops.

[Peaches]

They didn't say I'd be independent, I assumed I was staff since they brought me on as an office manager and instructor. Being on base pay is a salary, which again, thought I was an employee. The strange thing is, I swear I filled out a W-2 when I came down there, but it was never filed. I knew they weren't taking out taxes, but my concerns weren't really heard. I was just told they would help me out when it came time to file and they would find deductions. Yeah, that never happened.
Again, not speaking as a tax professional, ...

It is not their job to find deductions for you. It is yours. It is not their job to make your tax situation work out. It is yours. It is easy enough to check any sort of pay statement/invoice/etc. to see if they are withholding taxes, FICA, FUTA, etc. Unless you were hired and started working for them right before the end of the year (fiscal/calendar, whatever), this is something that you should have noticed. I'm sorry to be harsh, but that's the reality.

A quick check (which may or may not be a definitive answer, but it can at least give you a decent starting point to ask questions) of if you are an employee or independent contractor--look at the information return you should have received from them by Jan 31 of this year. Presumably you have this, since you mention filing taxes and getting jacked. If it's a W-2 form, you are most probably an employee; if it's a 1099, you are most probably an independent contractor.

If you are W-2, and they did not withhold taxes, then your next step is to check and see what sort of withholding/deductions you authorized. (I can never remember which it is.) Check out irs.gov, and search for Publication 919, which talks about withholding. A good step, to find out exactly what the IRS thinks is going on, is to talk to someone at the IRS. Go to a taxpayer assistance center (http://www.irs.gov/app/officeLocator/index.jsp) (walk-in, no appointment necessary, although there may be a wait), or call them. (http://www.irs.gov/help/article/0,,id=96730,00.html)

If it is a case where you are an employee, and you elected to have various whatnots withheld, and they are not following through with that...then you should get some professional legal/accounting/tax help. It may be worthwhile to contact the Taxpayer Advocate (http://www.irs.gov/advocate/article/0,,id=212313,00.html). Or it may not be, I don't know.

But the first thing you need to do--absolutely first, before anything else first--is figure out what sort of hiring/employment arrangement you have. Period. Regardless of what you thought the arrangement was, you need to find out what it is. If you have proof (emails, letters) that they promised you one thing and gave you another, that is a legal matter. But it sounds like you did a lot of assuming without a lot of understanding what the differences were.

Good luck.

FTR: Always, always, always keep copies of tax forms that you fill out. Always. Don't rely on your employer to keep copies of those sorts of things. Chances are they do have it, and can get it. But always keep your own copies. Period.

[pygmalion]

Thanks P. This is good advice.

[nucat78]

AFAIK (and I am not saying this as a tax professional), business size doesn't have a lot to do with it. The question is if someone is hired as an independent contractor, in which case AFAIK the employer does not need to withhold, or as a direct employee of the company, in which case they do.

That is my understanding as well.

[lcdancesport]

Again, not speaking as a tax professional, ...

It is not their job to find deductions for you. It is yours. It is not their job to make your tax situation work out. It is yours. It is easy enough to check any sort of pay statement/invoice/etc. to see if they are withholding taxes, FICA, FUTA, etc. Unless you were hired and started working for them right before the end of the year (fiscal/calendar, whatever), this is something that you should have noticed. I'm sorry to be harsh, but that's the reality.

A quick check (which may or may not be a definitive answer, but it can at least give you a decent starting point to ask questions) of if you are an employee or independent contractor--look at the information return you should have received from them by Jan 31 of this year. Presumably you have this, since you mention filing taxes and getting jacked. If it's a W-2 form, you are most probably an employee; if it's a 1099, you are most probably an independent contractor.

If you are W-2, and they did not withhold taxes, then your next step is to check and see what sort of withholding/deductions you authorized. (I can never remember which it is.) Check out irs.gov, and search for Publication 919, which talks about withholding. A good step, to find out exactly what the IRS thinks is going on, is to talk to someone at the IRS. Go to a taxpayer assistance center (http://www.irs.gov/app/officeLocator/index.jsp) (walk-in, no appointment necessary, although there may be a wait), or call them. (http://www.irs.gov/help/article/0,,id=96730,00.html)

If it is a case where you are an employee, and you elected to have various whatnots withheld, and they are not following through with that...then you should get some professional legal/accounting/tax help. It may be worthwhile to contact the Taxpayer Advocate (http://www.irs.gov/advocate/article/0,,id=212313,00.html). Or it may not be, I don't know.

But the first thing you need to do--absolutely first, before anything else first--is figure out what sort of hiring/employment arrangement you have. Period. Regardless of what you thought the arrangement was, you need to find out what it is. If you have proof (emails, letters) that they promised you one thing and gave you another, that is a legal matter. But it sounds like you did a lot of assuming without a lot of understanding what the differences were.

Good luck.

FTR: Always, always, always keep copies of tax forms that you fill out. Always. Don't rely on your employer to keep copies of those sorts of things. Chances are they do have it, and can get it. But always keep your own copies. Period.

Thanks Peaches. Luckily, with being independent before, I kept track of every little thing I spent money on so it was all documented. I didn't expect them to tell me what to do, I just voiced that what they are doing isn't going to work.

I filed a 1099, but by IRS definition, I was an employer. I know what they did/are doing isn't right. I just wanted a few more opinions. I'm no longer at that studio, just stuck with the bill. I'm going to look into some legal advice and if I can't do anything, well, I learned a costly lesson.

[pygmalion]

I'm glad you moved on.They didn't do right by you, IMHO.

[wooh]

Yikes! So this business (seemingly) hid behind a technicality?

It's not a technicality. I go to my regular job, I'm an employee. So they do all those deductions and my paycheck is way less than the amount I make per hour times the hours I work.

I also have a small side gig. I do it as an independent contractor. I have an amount that I make per hour, and the check is that amount times the number of hours I work. As an independent contractor, it's MY responsibility to pay my taxes on that.

There are pros and cons to be both being an employee and an independent contractor.

Either way, it's my responsibility to know if taxes are being taken out. And if they aren't, to plan for the certainty that I'll have to pay taxes.

[pygmalion]

What about if you're relatively new to the US system of doing things (as quite a few dance teachers and other immigrants I know are?) Does the employer have no responsibility to tell you the truth?

[wooh]

To highlight something peaches mentioned, in which case I believe you would have recourse (and like her, I'm NOT a tax professional! :) ):
The one point in which the employer/customer business you're doing work for WOULD be liable for taxes they didn't withhold would be if they were to pretend to withhold the taxes and didn't pay those to the IRS. In other words, they explicitly told you that you were an EMPLOYEE and told you they were withholding taxes, but they actually weren't withholding taxes and were instead pocketing the money you thought was going to the government.

[lcdancesport]

It's not a technicality. I go to my regular job, I'm an employee. So they do all those deductions and my paycheck is way less than the amount I make per hour times the hours I work.

I also have a small side gig. I do it as an independent contractor. I have an amount that I make per hour, and the check is that amount times the number of hours I work. As an independent contractor, it's MY responsibility to pay my taxes on that.

There are pros and cons to be both being an employee and an independent contractor.

Either way, it's my responsibility to know if taxes are being taken out. And if they aren't, to plan for the certainty that I'll have to pay taxes.

Wooh, I don't know if you're an independent contractor with ballroom or something else, but I'd assume you have stuff to write off in that part of your profession. When I was an independent teacher, I was able to write off floor fees, showcase and competition entry fees, travel, hotel fees etc etc. In this other studio, I never paid for any of that, the studio covered all entry fees and any showcase or competition costs were included in the student's charges. I had nothing to write off as a contractor. Again, could be a costly mistake for not putting my foot down to this type of employment.

[Peaches]

From DH:
(disclaimer about this not being any sort of tax advice - furthermore individual states can establish certain rules of their own which may or may not apply at the state level - CONSULT AN EXPERT)
Okay, there are so many issues here... Let's start with the basics.

Any person who is hired to do work by an employer might file under W-2 rules or 1099 rules (there are others, but we're just working with those right now).

The differences between the two filing methods primarily relate to HOW and HOW OFTEN the work is accomplished.

W-2 is the form an employee receives from their employer which details all the compensation the employee has received in a year. The W-2 is also filed with the IRS directly by the employer.

A person who receives 1099 income is a person who is not an employee - they are an independent contractor. They are NOT subject to day-to-day supervision. Their work hours will tend to vary; their work locations *may* tend to vary. A clumsy way to think of them is as a mercenary: they are available from time to time on an as-needed basis only. The employer is not required to withhold ANY taxes whatsoever - you are responsible for taking care of those.

As a W-2 filer, your schedule will be very regular; you will have routine, frequent, daily supervision. You will tend to be part of a specific group of people, and your duties will seldom vary. Your hours will vary only occasionally. The employer is required to withhold certain taxes each time they pay you.

The less predictable your schedule; the less supervision you have; the less routine you have from week to week - as these things become more random, you will tend to be more eligible to receive 1099 income.

In your specific situation:

It must be said that you, as the taxpayer, are responsible for knowing what type of filer you should be. Surprisingly enough, the IRS, at no charge, will help you determine this - they WANT to help you determine this, they are trained to do so, and they will spend all the time in the world on the phone with you helping you to make a determination. Hindsight is 20/20, so obviously they prefer to help BEFORE errors are made... but even at this point, my first suggestion would be to set aside 2 hours or so, and call into the main Taxpayer Assistance number. Explain everything that has gone on thus far, omit no information or details, and get their opinion. You should also ask for this opinion in written form (yes, they'll do that) so that you can retain it for your records.

In my opinion, you are a W-2 worker who has the benefit of commission income. Your hours sound like they're regular; they refer to you as an "office manager"; you have repeatedly referred to receiving a base salary, etc.

If you were truly 1099, you would receive a "retainer", not a "base salary", for example (terminology may differ). If you were truly 1099, you would tend to be paid "by the job" rather than on a consistent, routine basis. If you were truly 1099, you would tend to work for multiple employers, doing similar jobs, but in different locations, etc (think of a plumbing subcontractor, who is called in when needed, where needed, compensated, rarely managed on a day-to-day basis, etc).

Can't recommend highly enough: www.irs.gov.

[lcdancesport]

What about if you're relatively new to the US system of doing things (as quite a few dance teachers and other immigrants I know are?) Does the employer have no responsibility to tell you the truth?

Pygmalion, I understand a lot of Europeans come to the US to teach. I don't have experience in any of that, but I would hope that person is smart enough to research and at least know others who are already working in a studio in the US so they know what to expect. Truth or not, keep track of all paperwork, emails.

[Peaches]

Thanks Peaches. Luckily, with being independent before, I kept track of every little thing I spent money on so it was all documented. I didn't expect them to tell me what to do, I just voiced that what they are doing isn't going to work.

I filed a 1099, but by IRS definition, I was an employer. I know what they did/are doing isn't right. I just wanted a few more opinions. I'm no longer at that studio, just stuck with the bill. I'm going to look into some legal advice and if I can't do anything, well, I learned a costly lesson.
Regardless of what you filed...what did they provide to you?

I can file 1099s all day long...doesn't mean I should have, doesn't mean that I'm an independent contractor. Given my circumstance, it just means that I don't understand my own tax situation.

What.did.they.provide.to.you?

[Peaches]

Wooh, I don't know if you're an independent contractor with ballroom or something else, but I'd assume you have stuff to write off in that part of your profession. When I was an independent teacher, I was able to write off floor fees, showcase and competition entry fees, travel, hotel fees etc etc. In this other studio, I never paid for any of that, the studio covered all entry fees and any showcase or competition costs were included in the student's charges. I had nothing to write off as a contractor. Again, could be a costly mistake for not putting my foot down to this type of employment.
Of course you don't get to write it off now--if you don't pay for it, it's not your business expense, it's not your write off. If they paid for it, it's theirs.

[Peaches]

What about if you're relatively new to the US system of doing things (as quite a few dance teachers and other immigrants I know are?) Does the employer have no responsibility to tell you the truth?
Of course your employer must be telling you the truth. But unless you have PROOF, it more-or-less comes down to he said/she said.

And, fundamentally, YOU are responsible for YOUR own tax obligations. If you do not understand your obligations, then find a way of understanding them. The.IRS.WANTS.to help you understand and file your taxes correctly. Kidding, cynicism, and conspiracy theories aside...it is generally less costly for them to invest in helping you understand and comply voluntarily/"voluntarily" (I'm NOT getting into that argument here.) than to clean up the mess on the back end. There are people and office and untold resources to accomplish them...make use of them!

Now, if you were told one thing and they have done something else...that is another matter. If you received a W-2, and they reported withholding, and yada yada yada...and they're not paying it...that's just a whole 'nother can of worms. But I really, seriously don't think that's the case here.

Bottom line: understand your own situation, and get everything in writing. Educate.yourself. Period.

ETA: This is not intended as tax advice.

[lcdancesport]

From DH:
(disclaimer about this not being any sort of tax advice - furthermore individual states can establish certain rules of their own which may or may not apply at the state level - CONSULT AN EXPERT)
Okay, there are so many issues here... Let's start with the basics.

Any person who is hired to do work by an employer might file under W-2 rules or 1099 rules (there are others, but we're just working with those right now).

The differences between the two filing methods primarily relate to HOW and HOW OFTEN the work is accomplished.

W-2 is the form an employee receives from their employer which details all the compensation the employee has received in a year. The W-2 is also filed with the IRS directly by the employer.

A person who receives 1099 income is a person who is not an employee - they are an independent contractor. They are NOT subject to day-to-day supervision. Their work hours will tend to vary; their work locations *may* tend to vary. A clumsy way to think of them is as a mercenary: they are available from time to time on an as-needed basis only. The employer is not required to withhold ANY taxes whatsoever - you are responsible for taking care of those.

As a W-2 filer, your schedule will be very regular; you will have routine, frequent, daily supervision. You will tend to be part of a specific group of people, and your duties will seldom vary. Your hours will vary only occasionally. The employer is required to withhold certain taxes each time they pay you.

The less predictable your schedule; the less supervision you have; the less routine you have from week to week - as these things become more random, you will tend to be more eligible to receive 1099 income.

In your specific situation:

It must be said that you, as the taxpayer, are responsible for knowing what type of filer you should be. Surprisingly enough, the IRS, at no charge, will help you determine this - they WANT to help you determine this, they are trained to do so, and they will spend all the time in the world on the phone with you helping you to make a determination. Hindsight is 20/20, so obviously they prefer to help BEFORE errors are made... but even at this point, my first suggestion would be to set aside 2 hours or so, and call into the main Taxpayer Assistance number. Explain everything that has gone on thus far, omit no information or details, and get their opinion. You should also ask for this opinion in written form (yes, they'll do that) so that you can retain it for your records.

In my opinion, you are a W-2 worker who has the benefit of commission income. Your hours sound like they're regular; they refer to you as an "office manager"; you have repeatedly referred to receiving a base salary, etc.

If you were truly 1099, you would receive a "retainer", not a "base salary", for example (terminology may differ). If you were truly 1099, you would tend to be paid "by the job" rather than on a consistent, routine basis. If you were truly 1099, you would tend to work for multiple employers, doing similar jobs, but in different locations, etc (think of a plumbing subcontractor, who is called in when needed, where needed, compensated, rarely managed on a day-to-day basis, etc).

Can't recommend highly enough: www.irs.gov.

Thanks Peaches, I really do appreciate your input. I'm going to call the Taxpayer Assistant line tomorrow. I would love to get written proof from them so I can figure out what to do next.

[lcdancesport]

Regardless of what you filed...what did they provide to you?

I can file 1099s all day long...doesn't mean I should have, doesn't mean that I'm an independent contractor. Given my circumstance, it just means that I don't understand my own tax situation.

What.did.they.provide.to.you?

Maybe I don't understand what you mean provide?

I worked 12-9 M-F. It was required to be there.
I was on base salary regardless how much or little I taught
I handled sales by closing my students and other teacher's students
I filled out weekly sales reports
I reported to bosses and went over weekly sales and upcoming events
Any comps or showcase sales went through the studio
I didn't make commission on anything
I didn't have any sick/vacation time or pay, insurance, 401K
I never paid floor fees as students never paid me
Students were considered part of the studio
Teachers received training from time to time
I was given a 1099 for 2010 taxes

[Peaches]

Maybe I don't understand what you mean provide?

I worked 12-9 M-F. It was required to be there.
I was on base salary regardless how much or little I taught
I handled sales by closing my students and other teacher's students
I filled out weekly sales reports
I reported to bosses and went over weekly sales and upcoming events
Any comps or showcase sales went through the studio
I didn't make commission on anything
I didn't have any sick/vacation time or pay, insurance, 401K
I never paid floor fees as students never paid me
Students were considered part of the studio
Teachers received training from time to time
I was given a 1099 for 2010 taxesRequired hours, salary regardless of hours worked, not receiving lesson pay directly, not paying floor fees...a lot of that sounds like straight-up employee stuff to me.

That you received a 1099...that is...interesting. I would look into that, because it sound strange. (NOT tax advice or opinion.)

Still though...this is stuff you should have been seeing on your paychecks. You should have noticed taxes being withheld, or not. Check them now, adjust them now, deal with this NOW. Don't get caught with owing taxes...plus interest and penalties. Cuz that can suck real hard, real quick.

(By "provide" I meant what paperwork was given to you by your employer/"employer" by no later than January 31 of the filing year.)

[nucat78]

Also, you could look into filing an SS-8 form with the IRS. The statute of limitations is 3 years.

Disclaimer: I am an IRS-registered independent tax return preparer but this advice might be inaccurate or inapplicable to your particular circumstances. Consult your personal tax advisor.

[lcdancesport]

Required hours, salary regardless of hours worked, not receiving lesson pay directly, not paying floor fees...a lot of that sounds like straight-up employee stuff to me.

That you received a 1099...that is...interesting. I would look into that, because it sound strange. (NOT tax advice or opinion.)

Still though...this is stuff you should have been seeing on your paychecks. You should have noticed taxes being withheld, or not. Check them now, adjust them now, deal with this NOW. Don't get caught with owing taxes...plus interest and penalties. Cuz that can suck real hard, real quick.

(By "provide" I meant what paperwork was given to you by your employer/"employer" by no later than January 31 of the filing year.)

My paychecks didn't have any withholding on them, most of the time they were hand written. When I started there last year I filled out a W-2 or a W-4. That is one thing I didn't make a copy of. It clearly wasn't filed because nothing was taken out of my paychecks. Funny thing is, I filled out a W-2 THIS year, but even before I left a month ago, nothing was being withheld. I never worked for a place like this before. Why fill out a W-2 or W-4 if you're not going to file it??

[lcdancesport]

Also, you could look into filing an SS-8 form with the IRS. The statute of limitations is 3 years.

Disclaimer: I am an IRS-registered independent tax return preparer but this advice might be inaccurate or inapplicable to your particular circumstances. Consult your personal tax advisor.

I was just looking at the SS-8 form today. It IRS site said it could take up to 6 months to process! I'm going to call instead and see if I can get information more quickly.

[toothlesstiger]

+1 on peaches' advice.

You might want to remember that dance studio owners are not dance studio owners because they love to do tax paperwork, or are any good at it. ;-) This could easily be a case of them either not wanting to be bothered with paperwork, or just not knowing how to do it right. "Never attribute to malice what can be accounted for by ignorance or incompetence." This does not excuse them for not doing things right, but it means that you've got to keep on top of things yourself.

And a fundamental principle of law applies both to studio owners and to their employees/contractors: "Ignorance of the law is no excuse." Don't wait until you inadvertently screw up, or get screwed over, before you find out what you and they are and aren't responsible for.

[lcdancesport]

+1 on peaches' advice.

You might want to remember that dance studio owners are not dance studio owners because they love to do tax paperwork, or are any good at it. ;-) This could easily be a case of them either not wanting to be bothered with paperwork, or just not knowing how to do it right. "Never attribute to malice what can be accounted for by ignorance or incompetence." This does not excuse them for not doing things right, but it means that you've got to keep on top of things yourself.

And a fundamental principle of law applies both to studio owners and to their employees/contractors: "Ignorance of the law is no excuse." Don't wait until you inadvertently screw up, or get screwed over, before you find out what you and they are and aren't responsible for.

Thank you toothlesstiger. :) Well I have left the situation, now I just need to see if I can rectify the damage.

[toothlesstiger]

Anyway, as to your current situation, I will echo the suggestion, you really should consult a tax professional. I doubt you can go after the studio unless you can produce a signed contract. Which you say they didn't give you.

[lcdancesport]

What a pain in the butt. You call the IRS and they say you have to fill out the form online. The one that takes up to 6 months to process! I already received an answer to my employer/Independent contractor question from my CPA, but was hoping I could more information through the IRS as well.

[jennyisdancing]

What a pain in the butt. You call the IRS and they say you have to fill out the form online. The one that takes up to 6 months to process! I already received an answer to my employer/Independent contractor question from my CPA, but was hoping I could more information through the IRS as well.

Above advice is excellent stuff, and I'm glad you've consulted a CPA about this.

From my non-expert point of view (and having a mom who used to work for the IRS), it kind of sounds to me like your employer wanted to have their cake and eat it, too - they wanted you to have a set schedule and follow their rules like an employee, but they wanted to avoid dealing with your taxes as if you were a contractor. Unfortunately I think a lot of employers try this sleazy maneuver, and they are risking trouble for themselves if the IRS finds out.

However, whatever their liability or fault might be, you still have to pay the taxes that you owe for yourself, as you know.

[3wishes]

lcdancesport, Peaches and Wooh make excellent points. That said, I would strongly urge you to seek a CPA with extensive experience in the Independent Contractor world and the CPA should have loads of experience with the IRS rulings and amendments to this section of the Office of the United States Treasury service.
Why? you might ask. You mentioned that you "moved across the country" for this job. Did you know that, potentially your move is a tax deduction? My Husband and I own a medium sized business. We deal with all kinds of public and private purchasers and providers of service including Independent Contractors. If your studio owners - are mis-representing the studio by NOT meeting their payroll taxes - they are in for a big surprise. If you are truly an independent contractor, they also do not have to "pay" your taxes out of your payroll check per se. That is on you to accomplish that.
I believe your best bet - on your situation is to sit with a CPA - and listen to their advice within the guidelines of the IRS Treasury Department. Consider it - a lesson learned.

[lcdancesport]

lcdancesport, Peaches and Wooh make excellent points. That said, I would strongly urge you to seek a CPA with extensive experience in the Independent Contractor world and the CPA should have loads of experience with the IRS rulings and amendments to this section of the Office of the United States Treasury service.
Why? you might ask. You mentioned that you "moved across the country" for this job. Did you know that, potentially your move is a tax deduction? My Husband and I own a medium sized business. We deal with all kinds of public and private purchasers and providers of service including Independent Contractors. If your studio owners - are mis-representing the studio by NOT meeting their payroll taxes - they are in for a big surprise. If you are truly an independent contractor, they also do not have to "pay" your taxes out of your payroll check per se. That is on you to accomplish that.
I believe your best bet - on your situation is to sit with a CPA - and listen to their advice within the guidelines of the IRS Treasury Department. Consider it - a lesson learned.

I wrote off everything possible, including moving expenses, any travel that was work related, mileage outside of my routine drive to work that was still work related, and anything related to showcases or competitions (clothing, shoes..) I have a good CPA and she understands my situation. The latest I heard is I'm supposed to get an email/letter from their accountant. Once I receive that, I'll be having another chat with my accountant. I've been looking into my options about the whole situation. I may and probably will bite the bullet on paying everything, but it doesn't mean I cannot stop this type of action from happening again to someone else. Dancers need to be protected and not mislead and taken advantage of. I know this has happened to others through the same people, but I have been the only one so far to do something about it.

[3wishes]

Good for you! For literally, taking the bull by the horns. There is a way that you can stop this from happening to others and that is to contact your assemblyman or state senator for your district where you live and sponsor bill written by your elected representative. Out of disaster comes great change! hugs.

[lcdancesport]

Good for you! For literally, taking the bull by the horns. There is a way that you can stop this from happening to others and that is to contact your assemblyman or state senator for your district where you live and sponsor bill written by your elected representative. Out of disaster comes great change! hugs.

Thanks 3Wishes. Either way, dancers need to have their rights too. It's too easy to take advantage of young pros, foreign pros, newly independent pros etc etc.