I currently run a tutoring organization with some other high school students (I live in Illinois). Our organization is just now getting paid gigs from local schools and libraries. Since the school year is about to start, we are looking to bring on about a dozen or so more tutors. We have only had one paid gig so far, which we are all supposed to be paid individually for (although we have several other paid gigs planned for the up and coming weeks). Our first school asked us if we'd like to be paid individually (which they said they'd prefer), or if we want just one check.
The problem with being paid individually is that not every tutor will work the entire session, and a tutor may attend one week, but not the next. We will be keeping track of the hours worked by the tutors internally, but the schools will not. We would prefer to get one check given to our organization because we have expenses that we need to be paid for (like advertisements, t-shirts, business cards, website, etc). We want to get one check from the schools, take a portion out of that for expenses, then pay each tutor according to the # of hours they worked.
My question is: If we collect the payment in one sum in form of a check, are there any sorts of taxes our organization needs to pay on that sum, and then when we distribute that money out to our tutors will they have to pay any sorts of taxes on their sum.
I need to know if I'm breaking any laws/regulations by collecting our payment through one check, then redistributing to our tutors accordingly.
Sorry if I'm being too vague/not making sense. Please let me know of any clarification you need.