Can a W2 employee also receive 1099 compensations?

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Can a W2 employee also receive 1099 compensations?

We are a real estate firm and have W2 salaried employee; he is also a real estate agent who receives his commissions as 1099. I was told by our payroll company that all W2 employee compensations (salaries, bonuses, commissions) must be run through W2 because the employer has to match FICA tax. Are there any exceptions to this rule, or we need to change commission payment procedure for our employee?

Asked on December 27, 2011 under Employment Labor Law, Alabama

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Someone  would not get 1099 and W-2 compensation from the same employer, since if someone meets the criteria to be an employee (W-2 compensation), then they would be an employee in all their relations with that employer. Someone could get 1099 compensation from a different employer or entity, of course--many people work for one company while being an independent contractor for another.


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