8 {{ upvoteCount | shortNum }}
8 {{ upvoteCount | shortNum }}

1099vs.W2 for a Single person.

by ramona_livegood
6 replies
Returning after a long hiatus because when I initially joined the world of IM was so new to me. I put myself back in the beginner seat so I can learn once again. Long story short I've took a break from IM, worked a few contracts, then full time, then back to contracting

Heres my main question... How does one choose between 1099 and w2. I know the usual answers is one offers more freedom vs the other, but is there a comprehensive chart? As a single person, unmarried and focused on work, I think we are taxed quite heavily. The amount of money I was taxed is probably like an interns salary/stipend lol.

I have the opportunity to work and choose if I want to do 1099 vs w2. I recently also became a home owner. Which choice can give me the maximum tax write offs? Does any one have some comprehensive list
#1099vsw2 #person #single
  • Profile picture of the author Kay King
    The question could be answered on the IRS site....financial and legal advice on forums can be 'dicey'...

    You are asking whether you should be an independent contractor (1099) or an employee (w2) - and it's a question only you can answer.

    Does being an employee come with 'benefits' such as vacation time and health care, etc?

    So many variables such as whether you will work from home or not....would be worth paying for an hour of a tax accountant's time to consider which form of work status is best for you.
    Signature
    Saving one dog will not change the world - but the world changes forever for that one dog
    ***
    2024 Patriot's Award for Service to Veterans
    {{ DiscussionBoard.errors[11710379].message }}
    • Profile picture of the author ramona_livegood
      Hi and thank you for your message. This is helpful because I need to make a decision by monday and didn't know where else to ask but also understand that "advice" in he financial/tax related arena can be like you say dicey. Thank you I did not know I can get an hour of a tax accountants time and go over this information. I appreciate that information
      {{ DiscussionBoard.errors[11710380].message }}
  • Profile picture of the author Kay King
    Do a google search for


    1099 vs w2 advantages

    Quite a few legal sites, etc with good info and ways to compare the two options. In fact google has a couple pages full of results comparing the two and explaining the advantages/disadvantages.
    Signature
    Saving one dog will not change the world - but the world changes forever for that one dog
    ***
    2024 Patriot's Award for Service to Veterans
    {{ DiscussionBoard.errors[11710381].message }}
  • Profile picture of the author savidge4
    The ultimate answer... is you do BOTH - trust me its the greatest benefit...

    There are a lot of variables at play with the new job opportunity... How much more does being a 1099 pay over a W2 if it works out to be W2 pay without the taxes taken out.. take the W2 option all day long. If its 1.5 to 2X+ then you take the 1099.

    BUT here is the deal with 1099... you need a "Business", as in registered business name and bank account. You then REALLY need to understand "Deductions" if you read: ( https://www.warriorforum.com/main-in...le-2022-a.html ) there are some links there with some official IRS publications that go over what is deductible and what is not.

    I would say in a perfect storm of a world for someone like YOU... both is really the solution.. your JOB ( W2 ) and some contract work on the side. an eBay side hussle? ( https://www.warriorforum.com/warrior...days-ebay.html )

    Another variable to consider with the job opportunity.. will you simply be working from home? and is it JUST THAT... labor from home? if this is the case again the W2 is your best option.

    Hope that Helps!
    Signature
    Success is an ACT not an idea
    {{ DiscussionBoard.errors[11710383].message }}
  • Profile picture of the author dave_hermansen
    Also keep in mind that as a 1099 employee, you are not only responsible for paying your own income tax (quarterly) but you are also 100% responsible for the FICA taxes. An employer, by law, has to pay half of your social security and Medicare taxes but when you are self employed, you pay the full amount yourself (15.3% in 2022 in addition to your regular income tax).
    Signature
    BizSellers.com - The #1 place to buy & sell websites!
    We help sellers get the MAXIMUM amount for their websites and all buyers know that these sites are 100% vetted.
    {{ DiscussionBoard.errors[11710538].message }}
  • Profile picture of the author ramona_livegood
    You guys are awesome. I haven't logged in for a few days (new job life) but will look into all the additional info. Thank you!!
    {{ DiscussionBoard.errors[11715296].message }}

Trending Topics