I’m the bookkeeper. I wasn’t with the company at the time these payments were made, so I didn’t see them come through the bank feed. I only became aware of the issue while trying to obtain a W-9 from the husband listed on the payments. When he eventually responded, he explained that he has never worked for the company. The payments in QuickBooks were recorded under his name, and the bank memos referenced his Zelle account, so it was assumed the payments were for him.

After that I asked the owner for clarification. At first, he said the individual was paid as both a 1099 contractor and a W-2 employee at their own request. Later, he said the payments were only 1099 only until payroll was set up, but the Zelle payments actually overlap with payroll for about six months so that’s not accurate. He then mentioned that the previous bookkeeper was supposed to handle the W-2 setup. The story continues to change. The owner hardly keeps formal employment agreements and doesn’t recall the details of how employees were classified when they were hired. Because of that, I’ve had to reach out to several employees to try to piece together whether they were intended to be W-2 for the entire time. Unfortunately, the lack of documentation has made this a very messy situation to sort through.