Am I an independent contractor ? 1099 ?

You don't file a 1099, they give you a Form 1099 showing how much you were paid at the end of the year instead of a Form W-2. You will need to save 20 - 25% of what you are paid for taxes unless you come up with a lot of deductions or make very little. Social Security alone is 13.3%.

You will need to make quarterly payments to the IRS. You will need a tax professional to help you figure out what to send in. You have to decide whether it is a good idea for you. If you can make some money and have no trouble saving for taxes, it could be a good deal.

 

I'm not at all sure that you can legally do this! It is my understanding that to be a legal "1099 contractor" you have to be using your own equipment, among other things.

Let's run this by RoadMedic and see what he has to say. I'll try to get his attention directed to this thread.

 

Roadmedic will say it's not legal. As an enrolled agent that is his only possible reply. It is done all the time and will most likely continue until the end of time.

I see it from the Taxpayer's perspective and not the IRS perspective. My interpretation is more liberal. IMHO, there is a lot of interpretation involved in taxation.

This subject has guidelines to make your decisions from. There will always be a big difference of opinions here. This will only change if they write new rules that don't have wiggle room.

This particular situation is probably not legal, even in my opinion. The contractor has no liability, control or responsibility.

 

I believe that is exactly what they are doing. And I don't believe it is legal at all.

 

You don't need to call them, go to their website. Here is some information:

http://www.irs.gov/pub/irs-pdf/p1779.pdf

http://www.irs.gov/newsroom/article/0,,id=173423,00.html

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

If you don't like the situation, find something else.

 

You are very welcome.

You can pay your tax at the end of the year. However, if you don't have a certain percentage paid in during the year, you will owe interest and penalties on the balance due. It is best to pay in each quarter.

Besides paying income tax and social security to the IRS, you must pay income tax to your state too if they have income tax.