Advice for working as an independent contractor

mikeybot

SPANAKOPITA!!!
#1
Looks like I have a good shot at a pretty good job providing on site set-up/tech support, the only thing is that I'd be classified as an independent contractor. I've never worked under this situation before so I was wondering if anyone has any advice, suggestions or things to look out for.

Thanks
 

CousinDave

Registered User
#2
Looks like I have a good shot at a pretty good job providing on site set-up/tech support, the only thing is that I'd be classified as an independent contractor. I've never worked under this situation before so I was wondering if anyone has any advice, suggestions or things to look out for.

Thanks


start shopping for medical insurance
 

LiddyRules

The 9/11 Moon Landings Were An Outside Job
#3
Prepare to get ***** on taxes at the end of the year.
 

Hate & Discontent

Yo, homie. Is that my briefcase?
#5
Prepare to carry a LOT of liability insurance - if something goes wrong, YOU are going to get blamed. Doesn't matter if you did it or not, you will take the blame for it.

Edit to add: This is the exact reason why I am NOT doing this shit.
 

Von Maestro

Registered User
#6
Prepare to carry a LOT of liability insurance - if something goes wrong, YOU are going to get blamed. Doesn't matter if you did it or not, you will take the blame for it.

Edit to add: This is the exact reason why I am NOT doing this shit.
Related to the above, look into creating an S-Corp as an entity with which to bill & have your money flow through.

1) It will create a wall between you & your work for the above mentioned liability issue
2) You do not have to deal with a 1099 & will have greater control over your finances (speak to your accountant)
3) You will have greater ability to procure cost-effective insurance buying as a business

Obviously you need to be more fiscally responsible when it comes to keeping cash on hand for taxes, but that is something you can plan for with your accountant.
 

stellarcomics

Registered User
#8
For the love of all things holy DON'T GET CAUGHT UP HAVING TO PAY BACK TAXES!!
Pay what you owe ASAP; even if it hurts, trust me!
It'll hurt WAY MORE on the back end (no joke intended).
I just finished paying taxes I owed from 2002-2008 with penalties like a motherfucker.
It hurt.
 

LiddyRules

The 9/11 Moon Landings Were An Outside Job
#9
I still haven't figured out my taxes for this year and I'm afraid to since a good portion of my income comes from independent contractor work. If the numbers are ridiculous, I'm going to probably see if I can find an accountant. I can't believe I didn't think of last year.
 

blazin

Registered User
#10
Track expensive, keep receipts, record mileage.

Pay quarterly estimated taxes

its not that bad. working for yourself is the shit.
 

LiddyRules

The 9/11 Moon Landings Were An Outside Job
#11
Track expensive, keep receipts, record mileage.

Pay quarterly estimated taxes

its not that bad. working for yourself is the shit.
Oh, it is. And the independence is something I hold of great value, even if I don't really see myself as working anywhere towards a larger paycheck or long term career options. But the money (or the job) needs to be remarkably good for me to sacrifice this level of freedom. The taxes thing is just really freaking me out now that I'm forced to consider it.
 

whiskeyguy

PR representative for Drunk Whiskeyguy.
Donator
#12
Related to the above, look into creating an S-Corp as an entity with which to bill & have your money flow through.
Definitely this. That liability wall between your personal and business assets could save your ass one day. It's not that difficult, or really that expensive, to set up either. It would probably be worth it if you plan on working as an independent contractor for over a year.

I also agree on keeping immaculate records... so much is deductible but you will have to prove you spent the money. Pick up a copy of Quick Books (or at least Quicken) and learn how to use it to track expenses.

Also, if you're leaving a career with benefits, you need to spend some time figuring out their value, and which ones the new company wont offer. A lot of people make the mistake of leaving a job with benefits for one with a higher wage, but actually less compensation when you factor in the value of your benefits from the previous job.
 
#13
Keep all receipts for everything, you can use alot of everyday expenses as write offs against your horrid tax bill. Gas, oil changes, mileage, tires, dinners, hotels etc

Make sure you keep your receipts in a file by quarter, if you plan to hire an accountant you will need to give him your receipts from each quarter.

Take about 30-35% of your pay and put it in a savings account for taxes, you might pay less but its better to over estimate (unless you have a steady pay)

Definitely create a S-Corp you can do it online https://www.legalzoom.com/legal-incorporation/incorporation-overview.html

Look into local independent contractors benefits programs its much cheaper than most programs.
 
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