Bartender forced to fill out Tax Form 1099 - is that legal? US Paywizard.org answers.
Question: May 2011
Is it legal for a bar just opening up to not pay their bartenders by having them sign a 1099 tax form? The bar pays no social security, taxes, etc. on their bartenders and the bartenders are required to divvy up their tips. How can they get away with this?
Answer US Paywizard.org:
Form 1099 is for independent contractors, not for employees. The IRS states very clearly how employees have to report income out of tip: http://www.irs.gov/pub/irs-pdf/p531.pdf
Unfortunately some employers improperly classify their employees as independent contractors to avoid the pain associated with having employees, namely: payroll taxes, minimum wages or overtime and other wage and hour requirements, or coverage for unemployment insurance and social security. Here's more information about this subject: http://www.google.com/search?client=safari&rls=en&q=bartender+and+form+1099&ie=UTF-8&oe=UTF-8http://www.theqbspecialists.com/blog2/post/2009/11/04/QuickBooks-Tip-Employees-vs-Independent-Contractors.aspx http://en.allexperts.com/q/Employment-Law-924/2008/9/1099-verses-W2.htm
I advise you to contact your local office of the hour and wage division and ask them how to deal with this. You will find the addresses and phone numbers here: http://www.dol.gov/whd/america2.htm