Offering 1099 position vs W2

[x10694]

I am part of a private practice group and we discussed offering a 1099 position vs W2 to our CRNA so as to attract certain candidates who do not need benefits package. Our lawyers said this is not legal or discouraged us to do that because if a worker is working like an employee, must be treated as one (i.e. W2). But everywhere I look, hospitals, surgery centers, other private groups are offering 1099 positions. Many job advertisement will say W2 and/or 1099 positions available. Do your practice offer 1099 position to CRNA/AA or MD? Has there been any legal issues? Any unforeseen downside or issues? Thank you.

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[BLADEMDA]

An employee can start out as a 1099 but after 12 months if he/she continues to work in the same place, perform the same duties and not employed elsewhere then technically, that person is a W-2 employee. The way to get around W-2 status is by using an intermediary company to employ the 1099 worker. I addition, the 1099 worker could/should be employed at other practices during the year. The more practices they work at the better in terms of the IRS.

I recognize our tax code is a mess and the odds of the IRS cracking down on a medium sized group are very low. Would you consider forming a company to employee all your crnas as 1099 workers? Or, make everyone in the practice a 1099.

Joseph Conrad

www.josephconradcompany.com

 

[BLADEMDA]

CRNA Application Form — CBFC

www.1099crnataxplanning.com

 

[pgg]

What's stopping you from offering a W2 package that's light on benefits but higher on cash compensation?

 

[Dr. Rude]

CRNA Application Form — CBFC

www.1099crnataxplanning.com

Whistleblower Office | Internal Revenue Service

Get information about the IRS Whistleblower Informant Award, how to apply for the award, news from the Whistleblower Office and more.

www.irs.gov

Whistleblowing: If it is good for the goose. It is good for the gander.

 

[x10694]

stopping you from offering a W2 package that's light on benefits but higher on cash compensation?

we do ... but we are in rural location and being flexible help attract as many CRNA as we can recruit and this does matter to a couple of our candidates who either has a working spouse thus no need for health insurance (extra 20k) or want to max out 401k to 66k ect. a few explicitly asked if there was a 1099 options.

 

[x10694]

An employee can start out as a 1099 but after 12 months if he/she continues to work in the same place, perform the same duties and not employed elsewhere then technically, that person is a W-2 employee. The way to get around W-2 status is by using an intermediary company to employ the 1099 worker. I addition, the 1099 worker could/should be employed at other practices during the year. The more practices they work at the better in terms of the IRS.

I recognize our tax code is a mess and the odds of the IRS cracking down on a medium sized group are very low. Would you consider forming a company to employee all your crnas as 1099 workers? Or, make everyone in the practice a 1099.

Joseph Conrad

www.josephconradcompany.com

Thank you. I wonder if an intermediary is how many big name hospitals, physician staffing companies bypass this legal requirement?

 

[x10694]

Whistleblower Office | Internal Revenue Service

Get information about the IRS Whistleblower Informant Award, how to apply for the award, news from the Whistleblower Office and more.

www.irs.gov

Whistleblowing: If it is good for the goose. It is good for the gander.

I assume that there must be a legal loophole as it is too commonly encountered on gasworks and physician job search advertisements ....

 

[aneftp]

Well at many hospitals in my area. They 1099 locums have set (3-4 day 1099 Schedule). They are on one year renewable contracts mixed with regular w2 employees. This is with the big management companies also.

Their schedules released with 45-60 days notice. I think that’s illegal.

Depends how you look at it.

You can word the contract to say independent contract and set it for 1 year with 30 days without clause termination.

 

[chessknt]

I have never heard of a time requirement for 1099.... Talk to your lawyers but 1099 vs W2 frequently is distinguished by your level of control over their schedules you have.

Independent Contractor Defined | Internal Revenue Service

Review the definition of an independent contractor and related tax obligations.

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The general rule is that an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done. You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done). This applies even if you are given freedom of action. What matters is that the employer has the legal right to control the details of how the services are performed.

 

[nimbus]

I have never heard of a time requirement for 1099.... Talk to your lawyers but 1099 vs W2 frequently is distinguished by your level of control over their schedules you have.

Independent Contractor Defined | Internal Revenue Service

Review the definition of an independent contractor and related tax obligations.

www.irs.gov

“You are not an independent contractor if you perform services that can be controlled by an employer (what will be done and how it will be done).”


That guidance implies that a CRNA can be an independent contractor if they actually work independently but not if they are medically directed. If the CRNA has to abide by your decisions and your plan, then they are your employee. The word “independent” is self explanatory.