Understanding Crowd Sourcing

New Solutions for Small Businesses?

What is Crowdsourcing? Wikipedia defines “crowdsourcing” as: “the act of outsourcing tasks, traditionally performed by an employee or contractor, to an undefined, large group of people or community (a “crowd”), through an open call.” Typically, crowdsourcing involves broadcasting a problem via the web and asking a large group of unknown individuals to solve the problem. Either the crowd or the asking individual can determine which solution is the best, and reward the winner either monetarily or via recognition. Crowdsourcing can also be used to do piecework; things that could take you hundreds to thousands of hours can be assigned to a “crowd” do be completed in days.

Some examples of crowdsourcing are: Design work. Numerous web sites allow users to submit a design project and have designers bid on the work. In other cases, designs are pre-submitted from the “crowd” and the user then pays for the winning submission. Programming. The same concept is used for programming applications and designing websites. Web tools are available to have your program application done quickly and often cost effectively. Data Entry. Have a large collection of small parts that need to be sorted for your website? You can use crowdsourcing to have the parts cataloged and categorized for you on a price per piece basis. Each member of the crowd gets paid for the portion of the work they complete. Data Classification. Take a large set of data and have the “crowd” help you sort through it. NASA has used crowdsourcing to help document its library of photos and even help prioritize the images it takes from the Mars Orbiter. They did this by launching a tool and asking the public to participate in their organization project. How can Crowdsourcing Help? Businesses. You can use crowdsourcing to develop a new business logo, design a website, evaluate/sort data, or get feedback on a new product or service. Essentially, crowdsourcing allows you to cost-effectively tap into a huge network of affordable freelancers. Freelancers. Crowdsourcing can be a great way to drum up new business. Websites exist to source new work from a wider geographic area than might otherwise be available to you. These crowdsourcing websites that connect businesses with freelancers generally collect a small one-time fee, although others take a percentage of the total transaction. Sample websites: www.99designs.com: allows customers to submit a call for identity, web, print, graphic, or merchandise designs, set a price, and select a winning design. www.vWorker.com: allows customers to access thousands of computer programmers around the world www.CloudCrowd.com: helps business owners or individuals access editing, translating, copywriting, and PR services Is there a downside? Some of the issues that come up when discussing crowdsourcing include making confidential information public, out-sourcing local work to third world countries, and uncertainty about the quality of work done by the “crowd”. While there are varied opinions about the value of crowdsourcing, the concept appears to be here to stay.   Retrieved from a great newsletter dated April, 2011 written by: Tarantino and Co., CPAs.  http://www.tarantinoco.com/

With the onslaught of healthcare insurance dilemmas for anyone but the young and healthy, Rothwell is determined to provide an extremely thoughtful and unique solution for contract consultants. Become a member of our group, and receive access to great group health care insurance (lower deductibles than most health care insurance you could choose on your own).   Also receive more tax help than you thought possible!

It is our vision to provide almost any service that contract consultants need on a day-to-day basis so that your life can be as hassle free as possible.  We will submit your taxes quarterly (no trying to save tens of thousands of dollars each year to pay back to Uncle Sam).

For a small weekly fee ($75/week pretax) and another fee that is based on a sliding scale to cover our overhead of taxes, you can get EXTREME services that will send your consulting life into a whole new realm.  You will feel comfortable because you and your family will be secure and stable, with a group health care insurance plan, every tax optimization possible, invoicing and collections, business insurances, compliance, etc., etc.

Sign up today at www.BenefitsForConsultants.com.

Or call Jill Freeman at 770-289-9502

How many 1099 Independent Contractors work for your company?

I’m here to broadcast (by megaphone) that it is essential to classify your Independent Contractors (IC) correctly or there may be cause for an audit of your company in 2011.  Your company may be a target of the IRS if you’re in an industry that typically engages 1099s.

Yes, ICs and consultants are an important part of America’s workforce.  Project-oriented employment is very prevalent in today’s economy.  But with the growing number of contractors, comes increased risk for employers.

It is important to pull your head out of the sand!  There are landmark cases clearing the way for increased legislation, fines and penalties for improperly classifying workers.  Intelligent business leaders MUST realize they are a short distance away from federal or state audits.  The Revenue departments want their tax revenue!

Rothwell can help!

• We’ll build a 1099 process for you that ensures the proper classification of all of your current as well as newly hired 1099 Independent Contractors.
• To retain your loyal consultants, we can create a compliant environment by bringing them into Rothwell’s Employer-of-Record program.  This model is a program especially suited for consultants who desire to maintain their independence.  They receive health care insurance benefits, business insurances (which mean Certificates of Insurances for you), tax optimizations (that will equal or better their self-employed tax savings), and all the back-office services they would like to utilize.

Contact us today!  Keep your independent contractors happy, yet compliant!

Info@rothwell-international.com

www.BenefitsForConsultants.com

Tip of the Month

for Independent Contractors

Use an Employer-of-Record* to

reap 3 great advantages

1. Lower your taxes by thousands of dollars each month/year! Use your business-related expenses to reduce your taxable income. You’ll see these savings immediately, not at the end of the year. Your business-related expenses will be stream-lined. You will reap major tax savings!!!

2. Join a Group Health Care Insurance Plan (pre-tax of course). Knowing that you are guaranteed to get on the insurance plan is a big relief! You also are relieved of the task of attaining Certificates of insurances that your clients request (Workers Comp, Liability, Errors and Omissions, etc.). No need to deal with multiple insurance brokers. 401K is typically a benefit offered as well.

3. Automatic tax filing. Quarterly, your taxes will be automatically filed with the State and the Federal Revenue departments. The taxes will equal your self-employment taxes (but remember that those business-related expenses reduce your taxable income by a bunch!). As an added plus, you finally get to contribute to your Unemployment Insurance account, and your Medicare account. The latter may be a nice asset for the day when you actually retire!

4 Tips for an Independent Contractor to keep more of  your earnings in 2011

1.  Create a habit to log all of your business-related expenses.  Don’t forget mileage from your home office to the client’s office, tuition and related expenses, professional fees and more.  Extra tip:  If you have a smart phone, there are some great Expense-Tracking apps where you can also take pictures of your receipts! (Xpenser or free ones).  How easy (if you make this a habit)!  These expenses can really rack up some good tax savings at the end of the year!

2.  If you are a W2 employee or using an ‘Employer of Record,” ask if they use an Accountable Plan for payroll purposes.  This model reduces your tax liabilities immensely by reducing your taxable income by all of your business-related expenses (see above).  Put your money in your pocket instead of Uncle Sam’s.

3.  Do price comparisons with your insurance brokers to ensure you are getting the best premiums for your health care insurance, as well as your business insurances such as Liability, Errors and Omissions, Umbrella policies, etc.  This can be hundreds of dollars a month in premiums (these premiums can reduce your tax liabilities, so keep track of them!).  By the way, health care insurance ‘deductibles’ are not able to be written off on your taxes…just the premiums…so it is better to have a higher premium with lower deductibles (rather than lower premium and higher deductible) when it comes to a tax savings.

4.  Stay on top of your invoicing and collections.  Make it a habit to immediately invoice a client on the same day your hours end.  Make a friendly reminder phone call when the invoices are 30/60/90 days old (and email a statement).

Go through an Employer-of-Record that gives you access to the above services (Accountable Plan, free access to business insurances, group health care insurance. Invoicing and collections and more).  Try: www.BenefitsForConsultants.com

Benefits to the Independent Consultant

Finally, Independent Contractors can also have immediate access to company benefits.  Join us and become a card-carrying member of this group and get all the advantages like healthcare insurance (guaranteed issuance!), 401K, Workers Comp, business and professional liability insurances, Unemployment insurance and much more!

In addition to these benefits you will also reap exceptional rewards from our expense reimbursement program!  Maximize your tax benefit and increase your net take home pay! Categories of reimbursable expenses which reduce your taxable income are:

Business expenses – These expenses include, but are not limited to, computer and office supplies, meals, professional fees, cell phone, automobile expenses/mileage, advertising,  per diem, etc.

Medical expenses – Qualified medical expenses including prescriptions, deductibles, copays, items not covered by insurance, etc. up to $10,000 per year. The benefit is realized in your next pay cycle, without having to wait for an income tax refund!

Dependent care - Dependent care expense reimbursements up to $5,000 per year are available to qualified individuals and families. Eligible expenses can include child daycare, adult daycare, after school care, etc.

Educational expenses – Up to $5,250 per year in qualified educational expenses can be reimbursed tax free. Receive reimbursements for tuition, books, related fees, etc.

After 6 months of membership you will receive an added benefit of having your individual income tax returns prepared at no additional charge.

Rothwell International can provide you with all of the above benefits and tax optimizations as well as save you every hour of the week that you may spend billing your clients and collecting on your invoices.  Let us do the work for you!

Benefits for Consultants, finally!

4 Ways an Independent Contractor

can make more money!

1.    Have someone else do your invoicing and collections

2.    Get cheaper healthcare insurance because of a group

3.    Have free access to business insurances

4.    Pay a lot less taxes because you have an expert on your side!

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To attain these money-making services and more, contact jill.freeman@rothwell-international.com today!

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

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The above link to the IRS has a very informative description of how a business determines if their independent contractors are classified correctly.  It also discusses the tax obligations associated with the correct or incorrect classifications.

Here is a brief excerpt:

Compliance issues at the client site

I see it more frequently lately.  And in 2011 and 2012, IRS will be cracking down harder!  Companies need contractors but they must maintain their 1099 or independent contractor’s compliance with the government.  Companies are worried about their exposure to IRS 1099 reclassification, co-employment risks, future penalties and taxes, and even legal action!  Companies desire to adhere to the independent contractor laws because the risks are large if their contingent workforce fails to meet compliance and regulatory requirements.

So, Independent Consultants…be proactive to defer their worries about you.  Work within a payroll status that classifies yourself correctly (Are you legitimately operating a business of your own?  Have multiple clients?  Hold the requisite business insurances?  No employer-employee relationship present (such as no project manager over you, no control over how the work is performed, using no equipment that belongs to the business, and so forth)?  If you cannot easily answer ‘yes’ to these questions, then choose a service provider that can put you in a payroll status that meets the legal requirements.  It may let you and your client sleep easier!

For more information or advice, click on http://www.rothwell-international.com/comparison/.

How will you be affected by reform changes? http://www.ajc.com/news/health-care/health-care-how-will-409705.html

Health care insurance coverage is a dilemma that is hurting many of us!  We innocently plug along with our daily lives. Trying to make an honest and decent living as a contract consultant. We remember the days when we were an employee of a larger company. The premiums have been established.  We could choose between the multiple levels of insurance (silver, gold, platinum), or a high-deductible plan.  The best advantage was that the insurance company could not deny us coverage!  They may put a 12-month rider on a preexisting condition, but that is typically the extent of refusal.

So, here we are…minding our own business.  Finding projects and contracts on our own because we are good at what we do.  But we can’t get healthcare insurance because our spouse has diabetes or a heart condition.  They will outright REFUSE to cover anything that has to do with that preexisting disease or illness.  This can be devastating.  And in this economy, it is not easy to get a permanent job with benefits.  What to do??  (Along comes Rothwell International.  We can help you with this dilemma).  This is a time that we must search for options!

I will keep you updated on any healthcare insurance information that comes through. I’m anxious to see how high the premiums can go (with preexisting conditions).  Stay tuned!