So I got an email about a job, and they require that I incorporate before I start

[Sureshot324]

I got an email about a job yesterday and by the description it sounds like a help desk/tech support type job. I replied saying that I was interested. They left a message on my phone today saying the job pays $28/hour (which is very high for this kind of a job where I live) BUT I have to incorporate first and they couldn't say more on a voicemail.

Is this a scam? What does this mean and why would they need me to incorporate?

 

[MikeyIs4Dcats]

tax avoidance?

 

[Capt Caveman]

I got an email about a job yesterday and by the description it sounds like a help desk/tech support type job. I replied saying that I was interested. They left a message on my phone today saying the job pays $28/hour (which is very high for this kind of a job where I live) BUT I have to incorporate first and they couldn't say more on a voicemail.

Is this a scam? What does this mean and why would they need me to incorporate?

/facepalm

Is this job located in Nigeria?

 

[FoBoT]

i would go with SCAM
search the company name

 

[Kanalua]

I would research more. They may hire you as a contract worker to avoid high employment costs (in Hawaii it's 40% of what you pay your worker in costs to Fed/State Government). Though it shouldn't necessarily require you to incorporate, just get a business license from your state, and they pay you as a independent contractor.

Definitely research more, and don't just assume its a scam...

 

[Gunslinger08]

I wouldn't immediately think scam. A lot of independent contractors incorporate for liability reasons. Maybe they want you to do it for some reason (ex. makes their business insurance cheaper).

 

[Newbian]

Ask if you get a night with the princess.

 

[Sureshot324]

Well I'm going to call them tomorrow morning. Does anyone know what all I would have to do to incorporate. Is there any disadvantage to doing so for me?

 

[AreaCode707]

Well I'm going to call them tomorrow morning. Does anyone know what all I would have to do to incorporate. Is there any disadvantage to doing so for me?

Sounds like they don't want to hire you, they want to contract you. It wouldn't be a permanent employee position, it would be a temporary (maybe long term temporary) contractor position. They want you to incorporate so they can hire your "company" rather than you as an individual. This limits the possibility that you and others could successfully sue them for co-employment.

The disadvantage for you to be a contractor rather than an employee is that you wouldn't get any of the perks of an employee. No paid time off, no insurance, no 401k, etc. That's why the pay is higher, to somewhat make up for the benefits you would not receive. The pay is likely also targeted at contracting firms, where the firm takes a cut off the top (so they firm maybe gets paid $28 and then turns around and pays the employee $16, possibly including some minimal benefits at the same time) and the company is talking to you simply because they like your skill set and are willing to work without a contracting firm in the middle.

 

[Gothgar]

sounds legit, go for it pussy

 

[Ika]

are you getting this job for 9-5 or just for some extra income?

 

[JS80]

My guess is they charge you to "help" you incorporate then they don't give you the job.

 

[Riceninja]

is this like that security guard posting where they make you pay to help you get certified?

 

[djmartins]

Make them pay for the incorporation.....

 

[Genx87]

Sounds like a contract gig and they want you to form a company so they can pay you. When this happens realize you are responsible for income taxes. That means at the end of the year you are going to be paying in as you are recieving full pay. Remember that in a traditional employment arrangement you are only paying half the FICA taxes(SS,Medicare). So plan for 12.7% of your wages to go to SS, and ~4% to medicare.

 

[AreaCode707]

Sounds like a contract gig and they want you to form a company so they can pay you. When this happens realize you are responsible for income taxes. That means at the end of the year you are going to be paying in as you are recieving full pay. Remember that in a traditional employment arrangement you are only paying half the FICA taxes(SS,Medicare). So plan for 12.7% of your wages to go to SS, and ~4% to medicare.

This. And there is no way they're going to pay for the incorporation due to the legal risk at which that places them, so don't ask. Asking would make you look much less business savvy.

 

[Phoenix86]

$28/hour really isn't a lot when you factor in the extra taxes (mentioned above) and benefits.

That's probably closer to $18/hour with decent benefits, or LESS.

 

[Gunslinger08]

It does sound like they want to hire you as a contractor. That means you'll basically be self employed with no benefits. You'll pay the self employment tax and probably have to send in estimated federal income taxes each quarter. For $28/hour, it's probably not worth it unless you really need the money.

 

[DaWhim]

if you assume this is a scam, the very first thing you need to yourself what do they get for you to get incorporated? NOTHING.

I wouldn't think this is a scam. if you know more about W2 vs 1099, then you will know 1099 = contractor = incorporated.

when you are on 1099, you pay the whole 15ish employment taxes. if you are on w2, this tax is splitted and your agency pays half.

 

[djmartins]

It does sound like they want to hire you as a contractor. That means you'll basically be self employed with no benefits. You'll pay the self employment tax and probably have to send in estimated federal income taxes each quarter. For $28/hour, it's probably not worth it unless you really need the money.

BINGO!
Employers are really out of hand these days.
Tell them to hire an Indian...


regards,
DJ

 

[techs]

Corporations have a bunch of extra rules and regs. Plus it will usually cost more to get your taxes done.

That said, if the job is one you want, contact a bookeeping/accountant service in your area and ask them how much it will cost, and what the ramifications are in your state.

 

[RyanPaulShaffer]

I've had offers for "independent contractor positions" before, but I've never had them demand that I become "incorporated". Sounds fishy to me. Ask where they are based from. Nigeria I would guess.

 

[Uppsala9496]

The other thing to be careful of is that if you do some work and get sued, the company can push most, if not all, of the liability on you since you are incorporated.

XYZ did not perform the work, they contracted out to your company (you as an individual that incorporated).

And I am assuming that you are not going to be carrying general liability, professional services, etc insurance. So, read whatever agreement they give you carefully, and look into this aspect.

 

[Capt Caveman]

I got an email about a job yesterday and by the description it sounds like a help desk/tech support type job. I replied saying that I was interested. They left a message on my phone today saying the job pays $28/hour (which is very high for this kind of a job where I live) BUT I have to incorporate first and they couldn't say more on a voicemail.

Is this a scam? What does this mean and why would they need me to incorporate?

Did you even apply for this job? Or is this just a random email?

 

[FoBoT]

you don't have to incorporate to be a 1099 independent contractor