Posted on 11/23/2021 3:56:25 PM PST by newnhdad
In need of self employment advice- 1099 contractor.
1099 bump
Okay. My line of work was considerably different. The advise given above will be helpful. My biggest challenge, which I did not meet and suffered for it, was making quarterly estimated tax payments. Set the dates and meet them using vouchers. Obviously track your expenses, too. Carefully sort and file all pertinent receipts.
God bless your work and family!
No offense taken. We did “well”, which means comfortable but not wealthy.
The best part was freedom from a govt. entity or a boss dictating to us.
Importing was new and scary but Rush convinced me I was capable of more than I ever imagined. From there it was just solving problems, challenges day to day. O owe him.
Survival is a great motivator.
If you didn’t realize it, you paid those exact same taxes as a W2 employee... you just never saw the money yourself. the employer deducts it directly from your wages.
as 1099, you’re left with the obligation to pay those same taxes yourself but you pay the taxes after expenses. which allows you to pour as much as you can in tax protected investment accounts, lowering your taxable income.
you can also reduce your tax obligation significantly by doing the work in a tax free state (ie: FL, TX, etc).
don’t forget to write off any startup expanses you may have.
also, if you can take a lower salary and take profits after the first year, those profits could be declared as cap gains by the investor (if you structured as an LLC) radically reducing your tax obligation.
Wish I had known what you knew.
Glad it worked for you !
Really, move to a tax free state is your solution? ever thought of sales tax and property taxes in those state?
Capital gains with a llc. what is your net gain in time and money after you deal with more regulations and cost of another tax return.
Look at the net, not the pieces like a liberal.
state income tax: 0%
sales tax: 5%
property tax: 1/3rd of northeast states
avg cost of most items 25%+ less than most states
paying cap gains (22%) on earnings is FAR better than being forced to pay top end fed tax.
obviously, you have no idea what you’re talking about
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