<p>My daughter has worked/is working for 2 small businesses in PA. With each business she has been paid with a check from the business but no tear off or any info about deductions. I can’t help but think there is something shady going on that would help the business and come back to bite the employee. Is there something we should know about tax/payroll laws in PA? Thanks for any information and advice.</p>
<p>bluejay - I have no direct knowledge of PA practices. But unless she’s being treated as an independent contractor, “check but no tear-off” is kind of weird … in any state.</p>
<p>Fair Labor Standards Act or similar REQUIRE employers to withhold deductions and have them file the appropriate paperwork. If they are INDEPENDENT CONTRACTORS, they HAVE to have a contract with the company, identifying them as independent contractors. There is a LOT of abuse of this, especially with small businesses and a problem for the worker who “doesn’t want to make waves” and risk losing the job and being seen as “difficult” and getting a bad rep. It’s wrong any way you look at it and unfortunately could subject HER to penalties and interest for not having things withheld (it happened to a friend’s BF).</p>
<p>Here’s the IRS take on the subject. [Tax</a> Topics - Topic 753 Form W-4 – Employee’s Withholding Allowance Certificate](<a href=“http://www.irs.gov/taxtopics/tc753.html]Tax”>Topic No. 753, Form W-4 – Employee's Withholding Certificate | Internal Revenue Service)</p>
<p>Did she complete a W-4? I have all our employees complete that and a HW-4 (for HI withholdings), as well as an I-9, to show they are US citizens or have a work permit. These are all required by my bookkeeper for them to be on our payroll. We have only one independent contractor, an MD who helps interpret our lung function tests.</p>
<p>Maybe she could innocently turn in her W-4 and ask sweetly whether they forgot to give her the receipt for withholdings?</p>
<p>It does all sound a bit odd. Is she working for them as a regular employee. If they do not provide her with a W2, but are treating her as a contractor, then at year end they should provide with other documentation for tax purposes (a 1099?). She would then probably have to pay self employment taxes (her share of social security plus the employer share).</p>
<p>I don’t know the rules about the paperwork involved to be a contractor rather than an employee. i would have thought it should have been made clear up front though.</p>
<p>I’m thinking this is going to bite the business and not the employee. If she doesn’t think she’s an independent contractor – she shouldn’t be classified as one. There’s a lot of noise about determining which is which – just finished reading an article about dog groomers and how they should be classified – and the responsibility of the business to be sure workers are classified correctly and paid correctly with deductions withheld and sent to the state and feds.</p>
<p>When she was hired, did they present her with W4’s to fill? That will classify her as salaried employees, otherwise they may consider her as contractors and send her a 1099 at the year end. Either way, it has to be clarified.</p>
<p>Thanks so much for the advice. Trying to get some answers.</p>
<p>I work for two churches as the pastor (in PA) and do not get pay stubs. Since the organists and I are the only employees, it was a pain in the butt to set up a separate check book with appropriate checks for showing withholdings. We’re paid out of the general checking account for the church. No withholdings for me, since federal laws mean I have to pay quarterly estimates as self-employed for some taxes, and it’s easier for me to just pay them all that way. Organist’s withholdings are handwritten in on the memo line of the check for one of the churches; I assume the same for the other one.</p>
<p>My kid worked for a small business while in high school and also was paid by a personal check type of check. Again, too few employees to merit the pain of two checkbooks. She was told that withholdings were taken out, and they were. They were noted in her w-2.</p>
<p>Your daughter can do a quick check to see if there are withholdings being made if she knows what her salary should be - see if the amount on her check equals her hourly rate or if it is less due to tax withholdings. She should also have asked her employers after receiving her first check what was being done about taxes.</p>