I am an Owner Builder. Been a Realtor for 10 years. Been arround the trades all my life. Tierd of working through a General Contrator. Want to work directly with the subs to build our own home. Finished cost arround $200,000. Problem! I met a very nice father/son team who does rough-in, siding, roofing, and dry wall. They have good references. Work for a lumber yard Monday-Friday building homes. On the weekend they work for themselves. They say they do not carry insurance or Workers Comp. “Never Had A Proble” they say. I like them but am afraid of the liability. Is there any way to have them build for me with no insurance or Workers Comp? What do you think? Thanks, Linda from Green Bay, WI.
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Check with a lawyer and read other similar threads in this business folder re sole propes and insurance. It is doable but you need the right forms and probably want to insure your self
Excellence is its own reward!
no. you need to cover them at your own cost if you dont then you take your chances. also it sounds more like they will be employees so you need to be taking taxes. unless you think you can 1099 at the end of the year but unless they are actuall licensed contractors and able to work independently with no supervision they will be considered employees. if you want to work them under the table then of course you lose the tax write off
What tax write off???
It's her own home!.
Excellence is its own reward!
the tax write off for wages paid out for work to the house
The only way there is a write off is if she sells it before living there two years. The wages become part of the cost basis then. If they are sole props the money is still a cost and still deductible as a cost.
Otherwise, she lives there forever and there is no write off, or she sells after two years and ther is no tax, unless the place is a monstrosity..
Excellence is its own reward!
Why exactly doesn't this father and son team get the proper insurance and become a legit operation?
They would have to charge the going rate and loose jobs?
You get what you pay for and if someone gets hurt you just may have a new dependent you never counted on.
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LAS, have a sit down with your exsiting insurance co., I 'am guessing that you will carry some type of insurance, on your new home while it is under construction, unless your sock drawer is more full than mine, but, even if your are paying cash for the whole project, I 'd still reccomend caring some type of ins. Your Ins. Agent should be able to answer specific questions. Oh, please enjoy your journey, and I mean that. Jim J. ps, question, just when is your move in date?? Do the Math.
Linda,
I am a contractor in Wisconsin. In order to obtain my license, I have to prove that I carry liability insurance each year.
They should have the license and the insurance. The license does not cost a lot, and really the insurance doesn't either. But what happens if they injure you or someone on the site? Or burn the place down? Or back their truck onto the street and hit a school bus?
I know at least one person who will be named in the lawsuit-
you.
That's just the bare minimum. But if their company doesn't want to carry workmen's comp, maybe they can sign off to you for potential injuries to themselves, and they are responsible for anyone they bring to the jobsite.
Or, you can form your own company for this job, pay employee $ to state and fed, and cover them and your project with insurance and workmen's comp. Tell them you'll just take it out of their pay.
Mad (I'm not a lawyer) Dog
I wonder how many properties "father&son" have acquired through this practice.If they are uninsured and hurt on your premesis,they will at the least tie you up in litigation,and at worst own your home & more in a settlement.
Use an insured,established contractor.
Insurance is just what it says, It insures you and anyone else involved that you will not lose your shirt financially.
Let's face it, do you want to take a chance and not be covered for an incident that will put you in the poor house, not counting countless restless nights?
You need to cover your #### in plain english. Either you hire a legitimate company that has all the proper licenses and insurance or contact your insurance company and take out whatever policy you need to cover them as workers in your home. Someone has to pay for insurance, but no one should be without it!
"One measurement is worth a thousand expert opinions"
Edited 5/24/2003 10:10:46 PM ET by Woodrow