The information posted on PayrollTalk is for informational purposes only and is not intended to substitute for obtaining accounting, payroll, tax, or financial advice from a professional accountant.

A question on how best to handle two different types of pay

I'm the treasurer of a small church in Florida and we currently have a student at a nearby university playing our organ each Sunday. At this point in time she is being paid a set amount of money at the end of each month for each time she plays. Because she's not an employee of the church she's considered an independent contractor and we issue her a 1099 at the end of the year.

The church council has voted to approve the hiring of a part time secretary that would work 4 hours per week at an hourly wage. I understand how to process the payroll for a few of the candidates as we would treat this person as an employee and pay her accordingly. But here's the question.....what if the organist was offered the job?

Could her organist work remain independent from her wages and we would write her a check each month for the number of times she plays and then calculate her secretarial pay and pay her a payroll check for those hours? My concern is whether once she's employed her services as an organist would have to be paid to her as part of her W-2 wages? If organist work can remain separate then it's easy but if her organist work must be included in her W-2 paycheck then I'm not sure how to do this.

If the organist work would have to be included in her W-2 wages what kind of payment entries would I have to show as we would be paying her xx.xx for the hours she works and then we would have to pay her a lump sum amount for the number of Sunday's that she played? I't doesn't seem feasible to try and convert her per session fee into an hourly wage as some services are longer than others and she's paid a different amount for special services like a memorial service.

Any advice on how to handle this would be greatly appreciated.

Comments

  • jadegurljadegurl ✭✭✭

    By hiring this person you are changing their status from a 1099 to an employee.

    You should not need to change the rate of pay for their organist duties however if you do not have a contract on file with them stating the rate of pay for playing the organ you should probably get one on file during the process of having them fill out new hire paperwork.
    You will need to include the payments for playing the organ with her payment for being a secretary as all earnings are now taxable. For this year they will get a 1099 for all payments made to her prior to her official date of hire as well as a W2 for all payments made after her date of hire.
    The attached publication should help.

    https://www.irs.gov/pub/irs-pdf/p1828.pdf

  • CaroleNJCaroleNJ ✭✭

    This is actually one of the times she can receive a 1099 as well as a W-2 from the same organization. Keep the positions separate as they are. As an organist, she is freelance and can play when and where she wants and can pick up other organist gigs if she wants to. As a Secretary she would be an employee. She is limited to 4 hours at a rate of pay per hour and is under church control as to what and how. Handle these positions separately.

Sign In or Register to comment.