Do I Need To Send Subcontractors A 1099?

Donna Blackwell from Personalized Bookkeeping and Tax Services, Inc. Explains In This Podcast

Donna is an Enrolled Agent and a Certified Acceptance Agent who has been doing personalized tax service for over 30 years.  Her business does bookkeeping, payroll, IRS representation, issue 1099, and more.  Donna herself has employees and subcontractors who work for her.

What is the difference between a subcontractor and an employee?

An employee is told what time to come to work and they use the business’s equipment.  Even if working virtually, the business still tells them what time to be working.

A subcontractor does not work in the businesses office and they may work for various businesses.  The business does not tell them when to work.  They use their own equipment, paper, pens, ect.  A subcontractor may or may not have contact with a businesses customers

If a person is paid by the hour, are they a subcontractor or employee?

Being paid by the hour is a gray area.   If the business tells you when you must start working, what hours to work, and when you can be done working, you are an employee.   If you clock in when you would like to work, you can be considered a subcontractor, even if you are tracking your time and being paid by the hour.

As a subcontractor, what forms need to be filled out for a business?

According to Donna, a business should ask you from the start for a W9.  You can find a W9 on the IRS website

W9 do not need to be kept by the business for a certain amount of time.  Donna puts them into her system and then files it away in the subcontractors file.

What about a 1099?

A business should send you a 1099 at the end of the year if they have paid you $600 or more.  1099 are due to subcontractors by January 31st, or the Monday after if the 31st falls on a holiday.

You can not get a blank 1099 online.  They are special red copies that need to be purchased from the IRS or an office supply store.  They can be hard to get in January, so Donna suggests purchasing them early if you are a business who will need to send them to subcontractors.

Should I use my Social Security number on the W9?

Do not use your ss# on W9, get a Federal ID Number from the IRS website using your name or a business name.  Giving out all of your personal information  and ss# to people is a security risk.  Also, from a business standpoint, If the Dept of Labor audits a business who has written a 1099 with a personal SS# they question it, while one written to a company with a federal ID number is not.

How do I get a Federal ID Number?

Donna says that it only takes 5 or 10 minutes to fill out the SS4 on the website to get a Federal ID number.  It can be filled out as Sole Proprietor, LLC, or other type of corporation.

Even though the year has just ended, there is still time to fill out the form to get yourself a Federal ID number.  You can ask any business you have worked for who owe you a 1099 to use your new Federal ID number instead of your Social Security Number.

What if I want to change my business from a Sole Proprietor to a different type of corporation?

You will need to get a new Federal ID number if you change your type of business.

As a subcontractor, do I only need to claim anything over $600?

As a subcontractor, you need to claim any amount of money you make.  You must claim money under $600 per year and over $600 whether the business you worked for sent you a 1099 or not.

Do I need to charge or pay sales tax?

Typically, you do not need to charge sales tax on labor, but do need to charge it on products.  You can check with your Department of Labor in your State to verify.  Donna notes that some Programmers are required to charge tax on their labor depending on the platform they are using.  Always ask your Department of Labor if you have any questions.

Bank account tip from Donna:

Anyone operating a business should have a separate bank account for it. Keep your revenue and expenses separate.

What do you do for Tax Debt Relief?

Donna says she deals with people who have not filed taxes in a few years, or are dealing with an audit. 

Find Donna at, email her business at 615-773-2736

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Janine Gregor – A Virtual Assistant Matchmaker

As a Virtual Assistant myself, it brings me great joy to introduce to my followers a fellow business owner who has turned to subcontracting for successful entrepreneurship. Janine Gregar is a matchmaker for virtual professionals and owner of Your Virtual Dream Team. Her business journey has served as an inspiration for me, and I hope you will find great value in her experiences.

Janine started her business almost 15 years ago, determined to work in a more efficient way and to make the time to oversee her pre-teen son’s education. After working in retail and marketing fields in the New York area she found herself at a crossroad, not knowing exactly the field she would want to focus on. She did her homework, researched remote opportunities, and  realized she could marry her experience with her desire to help professionals and businesses by becoming a matchmaker for virtual assistants. Her perseverance and wisdom are an example for me. 

You can learn more about Janine’s business by visiting her website, or by emailing her directly at:

Could you use another Set of Hands so you can take on More Work? Click here

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Screened Telecommuting Jobs on Virtual Vocations

With more and more professionals searching for remote job opportunities, turning to a reliable source of information is quite a blessing. 

And this is precisely what offers. Created a decade ago by Laura Spawn and her brother, the website offers a curated database of telecommute jobs for job seekers, in addition to e-courses and various key resources.

Listen to this podcast to learn how Laura’s subcontracting team does the groundwork so you can apply to jobs with confidence. You’ll also learn how Virtual Vocations morphed over the years, its story and what to expect when subscribing to this website.

Enjoy and remember do provide feedback!    

Business Growth, How & What To Subcontract, Podcast

Brandon Turner – Procedure Sheets Uses Subcontracting

If there’s one thing that I have learned from my many years as a virtual professional is that efficiency is key in remote operations. Founder of Procedure Sheets, Brandon Turner is a model of efficiency. His business concept is centered around productivity, making use of smart tools, and staying highly organized. Brandon helps people build businesses that can run without them – and what business owner wouldn’t want that? A machine that can run smoothly without the constant involvement of the owner.

Procedure Sheets creates flowcharts and writes operating procedures that owners duplicate themselves and use to further delegate tasks. Brandon’s team takes video and audio recordings of a business’ process and then transcribes these into procedures. The video allows them to insert the screenshots into the procedures, while the audio allows for messaging directly from the owner or the manager, thus a higher impact when enforcing the procedures.

Learn more about Brandon’s business by visiting his website, For online consulting services, also offered by his team, visit

Could you use another Set of Hands so you can take on More Work? Click here

Business Growth, How & What To Subcontract, Podcast

Conferences That Empower:

In the last couple months I’ve had the pleasure of attending two online business conferences. The first was for my outside-the-home job, as a school district business service coordinator. I belong to the Wisconsin Association of School Business Officials, or WASBO for short. The other was in relation to my virtual service business, the Online International Virtual Assistants Convention 2017, or OIVAC. Another organization I belong to is IVAA, the International Virtual Assistants Association. So I’d like to chat about why these conferences and associations are so valuable to me, and why any virtual service providers or subcontractors should consider joining.

It’s important to note that the purpose of an organization is not simply to charge a fee for a basic, static membership. You need to know, and understand, the benefits of joining, and how best to take advantage of it. You gain the most benefit by putting forth effort into the organization, rather than waiting to see what it’s going to give you. This is a good principle in business regardless: take the initiative to reap the greatest benefits.

So many of these associations offer fantastic resources, such as job boards, forums, worksheets, and templates for a variety of purposes, and give answers to both common and complicated questions. These are the places to go in order to become well-known in your industry. I’ve been able to attend conferences and do networking in person, but you can make connections that are just as valuable virtually, such as with OIVAC. With any organization be sure to check if they offer any local get-togethers or other opportunities to meet fellow business owners.

The WASBO conference was a 2-day event packed full of great information and ideas. We had an opportunity to go through a program called A Year of Success, which assisted those of us who were business managers in the school to be as productive as possible through the year. In the district, there are different times of the year where you’re responsible for specific reports. So we have conferences throughout the year, focused on the upcoming reports. This information helps us with things like how to streamline our processes. It was very beneficial, and by meeting the other participants, we became somewhat of a family. It was just an overall great networking opportunity.

The other conference, which was for online virtual service providers, provided attendees with recordings that we could reference again in the future. Not only did I attend, but I also had the honor of being a speaker! I discussed the future of subcontracting, and was able to share my personal experience with others who were very interested in the topic. When you talk about having an opportunity to empower yourself, that was the sort of moment you’re looking for. I had a great time doing that.

Even through this virtual conference, I made 2 solid contacts, if not more. And I’m confident that I’ll be able to connect with more of them as I listen to the rest of the recordings. If you think you can’t get anything out of a virtual conference, I hope this shows you that so many valuable things can come from it.

Joining an organization or association is a great way to step out of your comfort zone. You’ll never make it big unless you’re willing to take risks, and these are the perfect opportunities to get out there! I’m sure that if you put in the effort, you’ll find that you’ll get your money’s worth. So go check them out, get out there, and start connecting!

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Subcontract Team A Source For Remote Jobs

With more and more professionals searching for remote job opportunities, turning to a reliable source of information is quite a blessing. 

And this is precisely what offers. Created a decade ago by Laura Spawn and her brother offers a curated database of telecommute jobs for job seekers, in addition to e-courses and various key resources.

Listen to this podcast to learn how Laura’s team does the groundwork so you can apply to jobs with confidence. You’ll also learn how Virtual Vocations morphed over the years, its story and what to expect when subscribing to this website.

Enjoy and remember do provide feedback!    

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What You Can Learn From Internships

Sharing The Virtual Experience

Members of the Air Force’s Kessel Run pre-employment team process canidate application packages during a hiring event at the Air Force’s Kessel Run facility, Boston Mass., Jan. 24. The KREL space house’s teams of Airmen tasked to create software specifically for use in AOCs.

The way I began my virtual subcontracting career was no officially an intern but much of the same concept. I had a mentor who I learned a ton from. Interns can be a win win for both parties. The virtual service provider giving the team member the opportunity to work under them is priceless. So I highly suggest providing an intern program or participating in one if at all possible.

Eden Spodak, who was a guest on Virtual Team 360 podcast 005, in this article one of her interns talks about what they learned during an intern experience at Spodek & Company. The company’s expertise is in digital marketing and communication. Eden was the service provider that gave someone the chance to experience her expertise. What a kind gesture.

Just like other things having an intern program takes work. You’ve got to research, plan, seek and be consistant at it It’s a way to give back in a sense. It can also be a way to figure out what parts of your business to start subcontracting. Will it make more sense to have someone else provide your clients’ social media, admin tasks, website services or online bookkeeping just to name a few services you may provide.

So how about you? Have you had interns on staff? Were the results positive? Or are you someone considering an internship in digital marketing and communications? I would love to hear more below!

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Who Hasn’t Been Banned From A Group Forum?

My podcast guest, MaAnna Stephenson, from episode 004 “Creating More Than Just A Website” shares an article about simple tips on using content, copywright language and why she was banned from a social media group. She even goes in depth about Pinterest.

However, like most of us we have at one time or another. So move forward and use it as a learning experience versus getting upset.

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3 Pillars of a Successful Business – Start on the Right Foot!

For most people a New Year and new beginnings means setting goals, resolutions, making lists with checkmarks that most times remain unchecked. So, instead of putting the pressure of achieving goals, I invite you to look at three aspects of your business, which tackled properly, will guide you toward making those goals a reality. 

There are three main aspects that I look at, or, as I like to call them, the three pillars to set the foundation of my business. Especially now, when the subcontracting business is at a turning point (and you can read more about this in my previous blog), I believe these strategies will give you the head start needed to make your business a success. 

The three pillars that we will look at are: creating your work space, setting the layout and vision for your business, and budgeting

Let’s start with the work space. Why is it so important? You may have heard the expression that context creates content. Imagine the context of your productivity being the work space. You are technically working from home 24/7 – hopefully not very long hours, but you are ‘on call’ in this business, aren’t you? Creating the space to fit your needs, from an organizational and emotional point of view, is key to productivity. Everything that surrounds you needs to support you in getting the creative juices flowing, staying focused and energized. So how can you accomplish this? First, note what sort of space appeals to you and helps you accomplish tasks quickly. Do you prefer a minimalistic decor, focused only on efficiency? Or, do you like being organized and having a warm, welcoming environment to maintain positive vibes at all times? Once you have found the answers, find an area in your house where to set up your work space. Look for ideas on Pinterest and Instagram, and remember that your work space is where your mindset changes. The moment you cross “the border” you must be in work mode, fully charged and committed to your business. 

The second pillar refers to envisioning and creating the layout of your business. You are, so to speak, in luck! Because this is what I have been doing lately for my own business and I have the knowledge to answer any questions, provide any tips to help you create your own layout. I started with a workflow of my vision for my business, which has helped me in putting together the plan. I recommend you follow the same steps. So far it has been working perfectly. To further help you, I have created a video with tips to setting up your work space and the project management layout in Asana, a project management tool that will become your best little helper, if it hasn’t happened yet. Click here to access the video and get ready to start your project, add team members, assign tasks, keep track of workflow and manage at ease.  

Last, but definitely not least, create a budget. From all aspects of your subcontracting business, budgeting may not be the most glamorous one, but for sure is necessary. Whether you set a budget at the beginning of the year, or per each project, knowing how to allocate your money, where to invest, where not to is crucial to generating profit each month. You will always have things to account for, either purchases or planning events, having to pay for certain products or services. A budget will help you stay on track and control your expenses, so you don’t finish the month with a negative balance! 

Now you have the tools to get started on your subcontracting business, and remember that I am your resource for questions if you get stuck. Furthermore, feel free to research and learn from other virtual entrepreneurs, like the amazing Laura Spawn, owner of Virtual Vocations – a tool for matching employers and job seekers with the best virtual job. Check out her website, her story, and don’t be afraid to learn from like-minded business people. 

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Subcontract Tech Tip – ASANA Create Workspace & Project

In the subcontracting niche having a project management tool to organize and collaborate with a team is a must have. This tutorial creates from a free version of ASANA the steps to create workspace and project to help you get your subcontracting team off on the right foot.