Q: Running a business and working as an employee with the same employer ?
I work at a school as a teacher and want to start a side business of after school activities. I want to start these activities at the same school I am working at as an outside vendor. When I checked with the employer they said that they can’t do that since they can’t give a W2 and 1099 to the same person. But I have a business registered as a sole proprietorship, can I not use that for the afterschool ?
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A:
You can indeed explore running an after-school activities business at the same school where you work, but it's crucial to address the legal and contractual aspects. As your employer mentioned, they cannot issue both a W-2 and a 1099 to the same person due to tax regulations. However, your registered sole proprietorship can serve as a separate entity for this purpose.
You should approach your employer with a clear proposal highlighting that your business is a separate legal entity. Explain how this distinction can allow the school to contract your business for after-school activities, thus avoiding the dual W-2 and 1099 issue.
Make sure to review any contractual or policy restrictions in your employment agreement that might prohibit such arrangements. Consulting with a tax professional or attorney might also be beneficial to ensure compliance with all relevant regulations and to navigate potential conflicts of interest. This way, you can potentially proceed with your business idea while maintaining your teaching position.
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