RANCHING Business
Medicare taxes from each paycheck,” Ross continues. “In addition the employer is required to pay a portion of the Social Security and Medicare taxes on each employee, which amounts to about 7.65 percent of the wages. An employer is also required to pay unemploy- ment tax to the Texas Workforce Commission.” It is less costly to hire contractors than employees,
but incorrectly classifying temporary help can be very expensive if you are audited by the IRS. If you classify an employee as an independent contractor and you have no reasonable basis for doing so, you may be required to pay the employee taxes for the entire period that the person has worked for you.
How old is the person? “It is very important to verify the age of young people
you hire so that you can comply with the child labor laws,” says Mike Holland, attorney with Holland and Holland in San Antonio. “Minors under 18 years of age can work in only non-
hazardous jobs. (Hazardous jobs, as identifi ed by the Secretary of Labor, are listed in Table 1.) Minors under the age of 16 have additional restrictions regarding the number of hours they can work. During holidays and
school breaks they may work as many as 8 hours per day and 40 hours per week between the hours of 7 a.m. and 7 p.m. The exception is that they can work until 9 p.m. from June 1 through Labor Day. When school is in session, work time is limited to a maximum of 3 hours per day and 18 per week.”
Is the person a legal resident? “If you don’t know the person you are hiring, it is
a good idea to complete a Form I-9 with the employee to verify employment eligibility,” says Holland. “The form should be completed for citizens and non-
citizens. Both employees and employers or authorized representatives of the employer must complete the form. An employee must present acceptable documents evi- dencing identity and employment authorization.” (A list of acceptable documents can be found in Table 2.) Holland continues, “The employer must examine
the presented employment eligibility and identity docu- ments to determine whether the documents reasonably appear to be genuine.”
What are the personal injury liability risks? “I carry a personal injury liability insurance pol-
tscra.org
September 2013 The Cattleman 43
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