So Happy to See The SCORE Crew!

I finally got to a SCORE meeting last week. Ever since the deluge of orders that happened in Necklace Town, I haven't been able to see the gang over in the Carmel, NY chapter. And I was in desperate need for advice, a business pick me up. I'm not a business person. I am an artist, a day dreamer, an inventor, a tinkerer, a renovator. I make jewelry all day. I do not like to add numbers, keep records, fill out forms, or do that Quickbooks. I last entered Quickbooks on November 9, 2010 and became so frustrated that I never went back to it. I'm back to pencil and ledger. It works better for me.

To see my retired business titans again today after nearly two months gave me such a relief. Down to business. Ben said I need an accountant right away. Jim the retired accountant, got on the phone and called one to get me going on getting my books in order. When I came home from the meeting, I had a phone message from a CPA. Ben said that my jewelry contractors meet the criteria of a 1099 and gave me a printout from the IRS outlining this. I mentioned this in "Who is a SubContractor or an Employee?" I met a new guy today, Ken. Ben filled him in on what I was about and what was going on and asked me what I want by the end of the month:

• Get the books together, get my numbers straightened out. NOW. I have 1099s to get out
• Get the big order at Necklace Town finished and put to bed.
• Find a space to move this operation. It's too much for my kitchen. I need more room for more people and room to store this material. I want to be able to go there, work, and lock up. We talked about a temporary spot, like a church or a synagogue to rent a space for short term but I can't drag these rolls of chain back and forth. Jim also called another associate on this one, who has offices to rent.
• Handle new inquiries to new business. How was it to be handled, what were the needs?
• Establish a strong core team that will be there for important clients at a notice to fill an order, establish other teams to handle other clients as their needs arise. Train them to my specific needs and expertise to be able to attend each client specifications.

Ken asked how I got all this business. I told him it was all the internet. That's how I started. The website, the blog, craigslist, Facebook, Twitter. Google jewelry assembly, jewelry outsource and I'm number one, two, three. Ben thought I paid for the spots! It's Search Engine Optimization. SEO has finally worked for me. And tending to social media has worked too, spreading the word of what I do. No paid advertising, no knocking on doors. It's like a garden, you do have upkeep and maintain the website.
I don't blog enough, I'm still kind of new to it and there's so much more I should be doing but right now, focus is on jewelry assembly.

On the way home, I pulled over at every sign I saw "Office For Rent" and left messages. I saw my first office yesterday. It had a listing price of $650 per month BUT it didn't include electricity, did include heat, ac and water (I didn't know you had to pay for water!). I learned what CAM was: Common Area Maintenance. I spoke to another realtor about another space that was $1780. That didn't include HVAC (air conditioning!) or heating (gas!) there's business taxes and proportional fees for the building. So why don't you just say it's $2,500 then?? This is going to be a picnic, finding a space that's going to fill my needs. Ben said don't take the first one I see. I didn't, it was too small. And did I need a sink vanity in one of those rooms? Strange....

I really needed a shot in the arm from SCORE today. Sometimes I come in there so bewildered (what am I doing??) and they take everything step by step, solve, find solutions and I leave more confident and relieved. I have help close at hand, expert advice that's free! and I'm so grateful to those SCORE guys! If you are just starting out in a small business or already in the thick of it and things are getting crazy, find your local chapter. It's like a business partner but you have many business partners all advising you from their vast wealth of experience. Do it!

Who Is a Subcontractor or an Employee? When to 1099 or W2

I just came from a meeting with a Certified Public Accountant. I told him about Necklace Town and all the help I've been collecting to get 13,000 orders out the door and he gave me a guideline to follow when considering one an "employee" (W2) or "subcontractor" (1099). VERY eye opening. This was sent to one of his clients, by the IRS, when a subcontractor filed for unemployment (!!!) when the temporary job was over. So for all those that aren't taking out Disability Insurance, Worker's Compensation, insurance, payroll taxes, FICA, listen up!

• A copy of any contract on which the services were obtained. If there is no written contract, please furnish the substance, in detail, of any oral agreement.
• Where did the individual work? Were they requited to work on your premises?
• Was the individual in an independently established business? If so, did the individual advertise in the Yellow Pages, or in local newspapers, craigslist? If possible, provide business cards, stationery, insurance certificates, ect.
• Could similar services be performed for others in a competitive business? Is so, furnish details regarding for whom such services were performed and whether or not they were performed during the same period services were performed for you. Are they working else where?
• Could work assignments you offer be refused? Under what circumstances could services be terminated?
• Was there a requirement to devote a specific amount of time to the services performed for you or was the time required to perform the service left to the individual's discretion?
• Was the individual covered under your liability insurance, Workers' Compensation or Disability Insurance?
• Were deductions made from the earnings for social security and income tax purposes?
• Who provided tools or supplies or equipment?
• When services were not performed for you, due to illness, ect, who furnished a replacement? Must permission be requested for time off?
• Who set the rate of pay and what was the basis of compensation, this is, hourly or weekly, or were the bills submitted according to the terms of the agreement? If bills were submitted. please furnish a copy or sample of such a bill.
• How were the sruvices obtained? Furnish copies of any advertisements, applications, ect.
• Did the individual have to call in absences?
• Were there any requirement to report at established times and work certain hours, for example, 9:00-5:00, 8:00-4:00, ect?
• Did you supervise or review the individual's work? if not, how did you insure the work was being done satisfactorily? If the work was not satisfactory, who was responsible to the customers?
• Did you provide reimbursement of expenses, and what fringe benefits did you provide?
• Did you provide training or required attendance at training sessions?
• Could the individual subcontract work?
• How free was the individual to develop their own design concepts?
• Did the individual deal directly with your clients at any stage of the project to discuss project requirements?

If you answered mostly NO to all of these questions, you would 1099 them. They would be considered a subcontractor. If you are unsure and answered YES to any of these questions or can't provide proof or otherwise, you would W2 them. They would be an employee and you would have to pay all the necessary taxes and deductions required by the Labor Department. If they find you have not followed the guidelines, you would be penalized $250.00 per employee, have to pay all back taxes, compensation, insurance from first day of employment with penalties and interest from beginning of your business. Scary!

A tough pill to swallow. So you better straighten out your employment situation before you get audited! I can explain a little more of each of these questions above and how to figure out where you might fall under so please don't hesitate to ask. I'm so glad I stumbled upon this!