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Started By
Message
Thoughts on a 1099
Posted on 4/13/17 at 10:50 pm
Posted on 4/13/17 at 10:50 pm
I'm new to the money board and seeking some advice from the money masters.
For the longest time I have been a W2 employee, but I am about to switch roles and become a 1099. I don't know much about it, but I have talked to a few people and was advised to form a LLC or PLLC and pay myself as a W2 employee. It is my understanding that I would then have to pay both payroll taxes, as well as W2 taxes. Is that the right way to go? Or is there another route? Also, I live in Texas so thankfully there are no state income taxes.
TIA
For the longest time I have been a W2 employee, but I am about to switch roles and become a 1099. I don't know much about it, but I have talked to a few people and was advised to form a LLC or PLLC and pay myself as a W2 employee. It is my understanding that I would then have to pay both payroll taxes, as well as W2 taxes. Is that the right way to go? Or is there another route? Also, I live in Texas so thankfully there are no state income taxes.
TIA
2
Posted on 4/14/17 at 12:36 am to gringeaux
If you're 1099 they better be paying you MUCH more.
Posted on 4/14/17 at 1:30 am to I Love Bama
quote:
If you're 1099 they better be paying you MUCH more
this, so much this.
Posted on 4/14/17 at 3:52 am to gringeaux
I started with an LLC and now I file as an S-Corp. You pay yourself a "reasonable" salary. You pay the 15.3% for SECA on that salary and not on the rest so you save that money there. There's other advantages, check this article out that I just searched. There's may more.
LINK
LINK
Posted on 4/14/17 at 7:05 am to Sho Nuff
^this
Posted on 4/14/17 at 7:48 am to Sho Nuff
quote:
I file as an S-Corp.
same here when i contract.
Posted on 4/14/17 at 8:39 am to Sho Nuff
Thanks, and yes it is going to be a good bit more than what I make now. Does the S-Corp have to pay payroll taxes on the "salary"?
Posted on 4/14/17 at 8:57 am to gringeaux
Yes. That's the whole point of treating yourself like an S-Corp. Well, not the whole point but a big part of it.
Posted on 4/14/17 at 11:15 pm to I Love Bama
E
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