workman's comp issue for a lease operator?

Michigan uses the old IRS 20 question test to determine if someone is an independent contractor, it is not very cut and dry and the IRS has moved on to more basic questions.

The current IRS test for independent contractors is at http://www.twc.state.tx.us/news/efte/appx_d_irs_ic_test.html

Michigan’s page is at http://www.michigan.gov/documents/u...Factor_IRS_Test_Revised_01-08-13_408013_7.pdf

 

I do occupational and it's much cheaper and you can pass it on to them. Ooida has it very reasonable if you cannot find it where you live.

 

The worst thing you want to do is not have it period. Big problems can arise out of that. Ooida has been fair to me, I have occupational and CMCI enrolled with them. Very satisfied, their liability and cargo is reasonable also if you don't use brokers, some brokers will not accept their insurance due to lawsuits against them.

 

One thing to think about,,,,,

Is your contract with the individuals or with their company? That will be a big deciding factor whether they are considered an employee or not. Write all the checks to the company and not the individual.

 

The carrier I work for requires L/O and O/O to purchase there own Occupational Accident Coverage....keep in mind Occ Acc insurance is similar to a Light or No Fat version of Workmens Comp. Less benefits, lower coverage limits, more exclusions but it tends to keep all sides happy and somewhat protected.

 

you will have to buy w/c insurance for your employees, unless they are ic's that drive your truck.

 

Make sure your contract doesn't lock them to you and you only. If it does, they are employees. As long as they are not obligated to do ANYTHING for you aside from assignments they CHOOSE to take your fine. They can work for you and you only and that's fine, but they can not be FORCED to only work for you, while working for you. It IS your problem to verify you are sub'ing work to a correctly set up legal company. They NEED to have workers comp! The only people who technically don't need comp policies are single person entities. (Like a Sole-Props). Make sure your paying their COMPANY and not them by name. Pay to their EIN and NOT a SS#. You need the DEC page from their comp policy on file in case they hurt themselves on THEIR time! If not you can't stop them from coming after you. You also need to be added as a certificate holder (NOT additionally insured) to their G/L policy so you will be made aware if their coverage lapses. I would also STRONGLY suggest incorporating or at least forming a LLC. Staying a Sole Prop is VERY dangerous to you. If they were ever re-classified as employees (which they shouldn't if you do everything right on your end) OR even of you did something stupid your truck, house, etc is ALL up for grabs. You MUST legally separate yourself from your company. Incorporating in DE or NV is popular for the very business friendly laws and low rates. You do NOT need to incorporate in your home state. Google IRS behavioral control to see what will make them employees.

 

You have to establish a claim history for a given period and then they will adjust your rate accordingly.