Payroll taxes...accountant help!

Howdy all.....been doing some pondering on what I am gonna do when I find some "good" help, and how/what im gonna do to keep them around....

Health insurance and Pension. I want to offer a good employee both, and keep it simple for us also.

What I WANT to do is $X per hour wages on a biweekly check, and $x per hour for health insurance and pension on a check to the employee. The idea is I give them the money to do it, and they do it themselves.

When I was a employee, that's what I always wanted.....to be in control of the money spent on my behalf, not some knucklehead in a office.

Can this be done? I figured the employee would have to be 1099'd on those extra funds, but could they then show it spent on insurance and pension come tax time like a write off? Im guessing this is not that easy, cause big brother cant get his greedy paws on it.....but.....

Ideas? thoughts? Im a small employer, and don't intend to ever have more than 5 to 10 employees.
 
When I was running my Bldg. biz. I provided the Workers Comp.(appropriate amount deducted per 'employee'), paid in cash (with a receipt from employee) and they were all independent contractors. Let them work out their own tax. Never had a problem. HTH
 
Isn't there a minimum number of employees needed for that to kick in? I never set up any retirement plans from my accountant advice and bought land instead. 2008 proves what other people can do with your money.
 
By pension I assume you mean 401k. Otherwise what you suggest sounds reasonable. Although I don't see how you can give them control and still know that the extra salary is applied to health insurance - maybe ask them to find a plan they like and offer to cover some (or all) of the payments on one of them.
 
Not bring a smart-azz, but I would not ask for CPA advice from a bunch of good old tractor mechanics, any more than I'd ask a bunch of CPA's how to set timing on an early JD Model "B". Go to your CPA.
 
external_link has changed things concerning paying employees extra wage to go toward health care. Better consult with someone trained in that area.
 
Don't be so quick to judge. Some of us are accountants, a few are CPA's and there are even a few real attorneys on here.
 
That's not really a good way to go about it, in my opinion.

There are companies out there that would do the things you need for a nominal rate.
Look for payroll processing or employee leasing companies.
You would write them one check every two weeks.

But first - check with the Better Business Bureau and ask about their insurance and bonding.
 
The government doesn't make it favorable to do that. If you buy health insurance for an employee it is tax deductible for you as a business expense. If you give the employee the same amount of money you would spend on insurance for them to purchase it themselves it will be taxable income to them and the insurance they buy will not be a tax deductible expense for them. The same thing can apply to pension plans.

If the government had really wanted to repair health insurance they could have made all health insurance tax deductible to the individual rather than to businesses only.
 
You can't do it through a 1099 - anything you pay them will be regular wages subject to Social Security and income taxes. If you try to do what you described the IRS will come after you.

http://www.nytimes.com/2014/05/26/us/irs-bars-employers-from-dumping-workers-into-health-exchanges.html?_r=0
 

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