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Frequent Contributor *

Subcontractor Hiring Another Subcontractor

Hello there. My uncle has a concrete company but is getting buried with past due payroll taxes as well as other taxes. Someone suggested to him that If he had someone open up a new concrete company (family member or close friend) his employees could be hired under that new company so he doesn't get buried under more taxes than he already is. Is this solution acceptable/allowable? He is currently an S Corp so he would only take his salary and hire the new company as a subcontractor to minimize his payroll expenses and I'm assuming the new company would be compliant with the payroll taxes and other reporting that follow the company's start up and progress. If anyone can let me know if he can hire a subcontractor even if he is a subcontractor and if this is even allowable. I know its confusing so thank you to anyone that can help!
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Established Community Backer ***

Re: Subcontractor Hiring Another Subcontractor

This question is way outside the scope of this forum.

Your uncle needs legal advice from a bankruptcy attorney. as he is probably on the hook for his S corp debts.