Sole proprietorship

[tdcrooks]

Hey everyone,

Does anyone here know anything about business law?

I'm getting a [Linux related ] job at IBM through an agency, and they said I would have to pay a mandatory, $60, "sole proprietor" fee before November...

I'm not sure why I would need this in any way, but hopefully someone on this forum might!

If anyone knows anyone who might know outside of the forums, I would GREATLY appreciate any info I can get on this subject.

Also, I know I'm asking a lot, but an answer before this afternoon would be ideal!

Thanks!!!

[arttorney]

The specific laws vary from state to state. What it sounds like they are doing is having you on their books as an independent contractor instead of as an employee. There are various reasons they might do that. The $60 might be needed to pay for certain filings that create a sole proprietor business for you, as the contractor, so they are covered if some government regulator should happen to look at their file on you.

[bob]

I can only guess but I'd think that you're not actually going to be working for IBM but as a temp and also not directly for the agency that arranged the hiring - so you'll be essentially self-employed; therefore "sole proprietor". Hope I'm wrong, but this should be a question that's easily answered by either IBM or your agency.

Before accepting anything, be sure to get it all in writing and the details hammered out.

[arttorney]

I agree. Among the various reasons this might be happening, the two most prominent are in the area of employee benefits and taxation.

If you are a contractor rather than an employee then maybe there is no need to provide employee benefits. (read no health insurance, no paid vacation, possibly no workers compensation coverage)

If you are a contractor rather than an employee then there is nobody doing your income tax withholding and you will be left with the responsibility of paying quarterly estimated taxes to the government (assuming U.S.A.). You will also have to pay the Self Employment tax, which is painful I assure you. For employees this part of the income tax is paid by the employer.

[tdcrooks]

Arttorney,

I probably should have specified that I live in Canada. Not sure how different the two countries are when it comes to this topic.

[I did find this: http://www.cra-arc.gc.ca/tx/ndvdls/s.../menu-eng.html]

bob,

You're right, the job I'm to get at IBM is indeed temporary: a 3 month contract to be exact.

---

The person I'm speaking with at the agency said they would have a workshop to go over what this sole proprietor thing is about tomorrow, but recently I went to an "interview" somewhere else that was supposed to be for an on the phone type "customer service" job, but turned out to be a one hour product demonstration followed by the woman saying that the job is basically door to door sales of that product. So now I'm sceptical as to what I'm really going to expect when I get somewhere... [unfortunately]

I mean, in reality, this workshop - since it's done by the agency] could easily skip certain details that might be of concern, or like my recent interview, "sell" it in a way that seems appealing, but really isn't... That's why I sought help / other peoples insights here [Thanks guys, btw ]

Basically, I'm a student with, might as well say no money left, and I just fear that this kind of agreement I've never heard of before might screw me over somehow. This "Self Employment tax" scares me now, too... I can't afford to pay for a pack of gum right now, let alone more taxes lol...

Would you go for it? Or, at this workshop that I will definitely attend, would there be any questions you would ask?

[pete_1967]

Things may be different on that side of the pond, but any job/ agent/ employer where they ask you to pay "fees" before you even get the contract signed sounds fishy to me and I wouldn't touch it with a 10 foot barge pole. Unless I buy product from them and sell those on my own account that is.

[bob]

Short answer: "no". There are still jobs out there, skilled and unskilled. You can do better, even if it's not in your specialty.