Commercial Check Cashing Services

This one is for the contractors out there… do you use a commercial check cashing service for cashing business checks written to your company? If so, do you cash the check(s) directly to a pre-paid credit card, debit card, or cash? Looking for some general information on the financial habbits of the smaller, independant contractors.

cashzone

in Accounting 12 years and 1 month ago

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cashzone | 12 years and 1 month ago

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To answer your question, it’s 2% + $5 per check.

greenmountain | 12 years and 1 month ago

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NYS Dept of Labor doesn’t care if I am small or large.  They require me to follow labor law generally and specifically, the Construction Industry Fair Play Act of 2010\.  (Law S05847). Free lance workers are employees.  There are almost no exceptions.  If I hire a plumber, for instance, and I am not a plumber, the plumber can be a sub.  But, if I ever install a vanity or a baseboard in the bathrooms I tile, I can not hire a freelance cabinet installer, free lance finish carpenter or a freelance tile setter or a freelance worker of any kind to do what I already do as part of my normal business.  You are right.  Hiring free lance or independent contractor or day labor, it is the usual way.  But, you haven’t answered my question:  How much do you charge to help contractors hire these workers illegally? Now, don’t pretend you thought it was legal.  If it were legal, we would not need you to provide us with cash – for what ever percentage of my client’s fee you take.  We would simply pay the workers by check, and when the New York State Insurance Fund auditor or the dept of Labor auditor show up, we would present our records.  Conveniently, your cash is not recorded as income, so our offsetting wages are not recorded as expenses either. Are any home owners surprised?  Is anybody shocked?  Home owners write checks to their contractors and contractors take them to the cleaners?  Is “turning checks in to cash” to evade taxes and commit insurance fraud a surprising sort of construction expense?  Does anybody else want to know how much does he charge?  What is the price of money laundering? How much of the home owner’s money do you get?  More than 5%?  More than 10% for not lifting a tool?  That would still be 30% savings over fully paying taxes and insurance.  If it is less than 5% why don’t you tell everybody in this forum exactly what you charge for your service?   I am not suggesting it is illegal to cash checks.   Nor am I suggesting it is illegal for home owners to hire unlicensed contractors.  The laws are directed at contractors.  Law-abiding contractors should be able to compete in a fair market place.  I am suggesting this is not a fair market.

greenmountain | 12 years and 1 month ago

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NYS Dept of Labor doesn’t care if I am small or large.  They require me to follow labor law generally and specifically, the Construction Industry Fair Play Act of 2010\.  (Law S05847). Free lance workers are employees.  There are almost no exceptions.  Only if I hire a plumber, for instance, and I am not a plumber, they are a sub.  But, if I ever install a vanity or a baseboard in the bathrooms I tile, I can not hire a freelance woodworker or a freelance tile setter or a freelance worker of any kind to do what I already do as part of my normal business.  Your right, it is the usual way, but you haven’t answered my question:  How much do you charge to help contractors hire freelance workers?   Now, don’t tell us you didn’t know it was illegal.  If it were legal, we would not need you to provide us with cash – for what ever percentage of my client’s fee you take.  We would simply pay the workers by check.  Are any home owners surprised some of what they pay for work on their homes goes to guys like this, to cheat the workers out of state required compensation insurance?  How much of the home owner’s money do you get?  More than 5%?  More than 10%?  That would still be 30% savings over fully paying taxes and insurance.  If it is less than 5% why don’t you tell everybody in this forum exactly what do you charge?   I am not suggesting it is illegal to cash checks.   Nor am I suggesting it is illegal for home owners to hire unlicensed contractors.  The laws are directed at contractors.  Law-abiding contractors should be able to compete in a fair market place.  I am suggesting this is not a fair market.

cashzone | 12 years and 1 month ago

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Well, the question (as was mentioned) was targeted at small contractors who, traditionaly, depend on ‘freelance’ labor and use the money from one job to pay for the materials for the next. I’m guessing that you passed that level of business years ago. Thank you for your entertaining and enlightening response.

greenmountain | 12 years and 1 month ago

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Just tell us:  What does it cost to cash a check made out to a contracting business? You know it is so hard to make a living if you have to pay employees and then pay 20% payroll taxes on top of that, and then by NYS Law you have to pay 20% of payroll on top of wages and taxes for Workers’ Comp Insurance!!!  Wow, that’s 40% higher for labor if taxes and insurance are included, like they are for other businesses!!! Gee, I guess if I can cash my client’s check and not deposit it in to the account I show to my auditors, then I can just pay the going rate for labor in cash, and leave it up to the workers to pay their taxes.  If somebody gets hurt, I can worry about that later. Sounds good!  How much do you charge to cash my client’s checks?  It’s got to be way less than 40% But if I cash my client’s checks and use the cash to pay workers, and withhold this information from my auditors and the NYS Department of Labor, would that be fraud?  And, what if one day the cash ran out and I don’t pay my workers.  There would be no record of my employing them in the first place.  Workers depending on cash, unless they report their income, probably would not complain.  Would that be slavery?   Home owners, how do you feel about this?