5th session

Tax Terms
1) C2C
2) W2
3) 1099

C2C (Corporation to Corporation):

 Staffing companies have Jobs.
 Bench sales companies have candidates.
 Staffing company (Corp 1) and Bench Sales Company (Corp 2),
when two corporations deal with each other then we call it
corp to corp or C2C.
 The Candidate will be on the payroll of his employer / Bench
Sales Companies.
 Bench Sales Companies are liable to pay candidates taxes.
 We cannot discuss the rates with the candidate.
 Only applicable for contract positions.

 Bill Rate is what we get from the client.

 Pay rate is what we pay to the candidate.

Bill Rate - $70

Pay Rate - $60
Bill Rate - Payrate = Margin
$70 - $60 = $10
W2:
 The Candidate will be on the payroll of staffing companies.
 In W2, we don’t reach staffing companies.
 We directly reach the candidate through our ATS (Application
Tracking System) and Job Portals (Dice, Monster, Career
Builder, Tech Fetch etc.)
 The Staffing Companies deduct the taxes of candidates.
 Applicable on Contract / Full Time.

In C2C, we can give higher rates.

Bill Rate - $70
Pay Rate - $63

In W2
First, we deduct taxes and then give rate to the candidate
Bill Rate - $70
Bill Rate after taxes = $70/1.2 = $58
Bill Rate – Pay Rate = Margin
$58 - $5 = $53

1099:
 We don’t deduct taxes; taxes are paid by candidates
themselves.
 Only USC and GC are applicable.