Questions tagged [contractor]

For questions related to working independently with an organization rather than employee. Most question may require country tag as law could vary from country to country. Additional tag like taxes could be used to qualify the nature of question

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32 votes
6 answers
44k views

Why do consultants or contractors make more money than employees?

Why do consultants or contractors make more money than employees?
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30 votes
4 answers
9k views

Possible customer wants me to handle payment to another contractor. Is this a scam or not?

I'm going to do some possible contract work in my field and I've had an offer for some work I found through a reputable venue. However, that venue doesn't handle payments or anything like that. I seem ...
user's user avatar
  • 1,063
29 votes
5 answers
9k views

Contractor wants client to open checking account

I recently heard about a construction contractor who's building a house for someone, and this contractor wants the client to open a checking account with the contractor's name on it so that the ...
BradDaBug's user avatar
  • 623
28 votes
1 answer
5k views

If I overpay estimated taxes in Q1, am I allowed to underpay in the other quarters?

I'm an independent contractor and I sent in my first quarterly estimated federal tax payment for 2023, but I realized that I went way over. Is it possible to pay less in the coming three quarters (...
fishingforgoats's user avatar
25 votes
2 answers
7k views

Do I need to pay taxes as a food delivery worker if I make less than $12,000 in a year?

I started working for Doordash, a food delivery service. Technically I think I am a self-employed contractor. I saw online that you don't have to declare taxes if you make less than $12,200 in a year. ...
deliveryguy's user avatar
17 votes
3 answers
2k views

Moving from full time to contractor

For many reasons I am moving from full time employee to a contractor with an associated company in a different city. Everyone I have spoken to says contracting is great except for the taxes and lack ...
pablo's user avatar
  • 275
16 votes
2 answers
64k views

How can I send a 1099-Misc if a contractor won't provide an EIN or SSN?

Acording to AICPA and this IRS Publication, as a landlord who paid for services for over $600 last year, I am supposed to be sending out 1099-MISC forms to the plumbers, handymen, electricians, etc. ...
JohnFx's user avatar
  • 53k
15 votes
2 answers
43k views

How to determine contractor hourly rate and employee salary equivalents?

I am aware of the general differences between being an employee and being an independent contractor. However, I am unable to easily compare the two when it comes to after-tax compensation. Company A:...
colithium's user avatar
  • 283
14 votes
3 answers
8k views

Can a roofing company charge me more money for the cost of the roof 2.5 years after they were paid and job completed?

I had my roof done (in Florida) 2.5 years ago. I paid my deductible and they were paid by my insurance company just after that. Now, just 2 months ago, again 2.5 years later, I get a call from them ...
Kim Deleo's user avatar
  • 149
13 votes
5 answers
10k views

I'm currently unemployed and have been offered a contract position. Do I need to incorporate myself? How do I do it?

I'm sure there are tax implications, and other things to consider. I don't know where to start.
Nat_Rea's user avatar
  • 8,683
9 votes
4 answers
11k views

Can I ask my employer if I can work as a contractor instead of an employee?

Can I ask my employer if I can work as a contractor instead of an employee?
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9 votes
1 answer
237 views

Independent contractors and new U.S. tax law

I make about $70,000 a year working as a contractor. Currently, I operate as a sole proprietorship. I invoice my clients using my personal name (I don't even have a business name), and they pay me ...
painter48179's user avatar
  • 2,761
9 votes
1 answer
723 views

What are the consequences of IRS "reclassification" on both employer and employee?

To begin, let me clarify that this question is not about how to avoid IRS reclassification. I want a better understanding of the consequences when it happens. Here, I am referring to when the IRS ...
Vivian River's user avatar
8 votes
3 answers
2k views

Are there contracts for fixed pay vs. fixed pay rates?

Are there any contracts that simply pay you when/if you finish a specific project with no mention of a fixed pay/hour? If so, does this mean you can get paid under minimum wage if you take too long to ...
confused00's user avatar
8 votes
2 answers
2k views

What happens to contractors when employer goes bankrupt?

The U.S. company at which I was a contractor has closed its doors and laid off all employees. I read in the news that all its assets were bought by another company. All regular employees were paid up ...
Shawn V. Wilson's user avatar
8 votes
2 answers
3k views

Hiring Foreign Contractors - Is This Tax Deductible?

I have a small start-up business in the US and I'm going through freelance sites like freelancer.com to get some work done. The appeal of this is that the rates for foreign contractors is often less ...
micah's user avatar
  • 243
8 votes
1 answer
1k views

How can I prove to the IRS that I didn't receive income that an employer incorrectly reported?

I received a notice from the IRS a few days ago regarding my 2012 filing. One of the companies I contracted for filed paperwork stating they paid me about twice what I actually received. It seems like ...
FreeAsInBeer's user avatar
8 votes
2 answers
2k views

I run my own nonprofit corporation. Should I pay myself as a contractor or an employee?

I started a run my own nonprofit corporation. We have a board of directors and my title is executive director, founder, and am on the board. We have been completely volunteer staffed including ...
Jeremy's user avatar
  • 81
8 votes
1 answer
1k views

Working remotely from Canada for a US company. How to get paid?

I am a Canadian who just landed a (short-term contract) job working remotely for a US company. Since this happened through a (US) recruiter, my employer would pay the recruiting firm, who would pay me....
Gabriel Ross's user avatar
7 votes
2 answers
9k views

Paying taxes on income earned in the US, but from a company based in Norway

I've recently begun work for a company based in Norway. Right now, I'm an "independent contractor" but in a few months I'll be made full time. I invoice them my hours on the 1st of each month, and I ...
user avatar
7 votes
6 answers
30k views

Which is better when working as a contractor, 1099 or incorporating?

When working as a contractor, is it better to work as a 1099 contractor or rather incorporate as a C, S or LLC corporation? (with one employee/owner/board member) (assuming that the pay is the same ...
Yona's user avatar
  • 203
7 votes
1 answer
306 views

New to working as an independent contractor, what do?

I'm already in the independent contractor boat. So my next steps are to learn how to pay quarterly IRS payments (fun). Should I just follow the form or do I need to use a software tool to better ...
Zombies's user avatar
  • 250
6 votes
3 answers
15k views

Tax considerations for outsourcing freelance work to foreign country

I've seen this asked a few different ways (closest was here), but I am looking to find out from the business's perspective, how to report (if necessary) the amount paid to a foreign contractor. My ...
Jon B's user avatar
  • 221
6 votes
2 answers
598 views

Tax implications of having some self-employment income?

I worked as an independent contractor for a short time this year (summer), bringing in under 5K in earnings. I have received all of my W2's at this point and am preparing to do my taxes this weekend. ...
Scott's user avatar
  • 854
6 votes
1 answer
683 views

If my parents claim me for taxes do I have to pay taxes?

This is kind of a late question. I am contractor at my current job (19 years old) and I have to pay taxes this year. If my parents claim me will the taxes I owe just come out of the money they get ...
user avatar
6 votes
1 answer
390 views

Can I write off expenses during a contract-to-hire period?

In a few weeks, I will be starting at a position where I will be a contract employee for 30 days and then hired on as a "normal" employee, assuming I meet the expectations of my new employer. I will ...
Sean Walsh's user avatar
5 votes
1 answer
2k views

Time limit on sending invoices in the United States

Is there a time limit on how long one can wait to send an invoice? E.g. supposing a contractor does some work, and does not issue the invoice promptly. Is there some time limit to sending the invoice, ...
Robert Dodier's user avatar
5 votes
3 answers
997 views

About to start being an Independent Contractor - Any advice on estimating taxes?

I am a grad student that is about to pick up 10-15 hours of independent contracting work per week. I work and live in Syracuse. I make $19,000 per year (pre-tax) as a grad student, and will make $25/...
traggatmot's user avatar
5 votes
1 answer
20k views

Contractors: Guideline on what percentage to keep when hiring a SUB-contractor?

My business may be growing past the point beyond which I can no longer handle the jobs alone (yay me!)... If mine is an hourly job, with little to no overhead, and I bring someone on to work the jobs ...
Nat_Rea's user avatar
  • 8,683
5 votes
1 answer
933 views

How do I compare contract hourly rates with permanent/employed yearly rates, (in UK)

I am thinking of contracting, but do not know how to compare contract (inside and outside IR35) with permanent rates, within the United Kingdom (specifically England). So far I have considered: That ...
ctrl-alt-delor's user avatar
5 votes
2 answers
139 views

How to secure one's effort when working on a contract?

As a youth I was verbally contracted by my then-dentist to write a system that spares him from being innundated with patients paperwork. Naively, I negotiated neither requirements nor compensation. ...
Calaf's user avatar
  • 333
4 votes
1 answer
6k views

How to properly report income without 1099-MISC

I started a new freelancing job at the end of last year, and I've been paid thus far below the minimum for a 1099-MISC to be required (at least I believe so, it was one paycheck of $40). How do I ...
Yamikuronue's user avatar
  • 1,319
4 votes
1 answer
698 views

Can money paid to an independent contractor be split among subcontractors as deductible business expenses?

I currently work in a small freelance programming group in the United States that is not set up as any sort of corporation or LLC. Essentially we are just individuals acting as a small programming ...
colavitam's user avatar
  • 143
4 votes
1 answer
283 views

Does a total due tax of over $1000 automatically get placed in a quarterly payment plan?

I work as a contractor and I'm filing through TurboTax this year in the US. I owe just over $1100 this year. I've always been in the green before this year - always received a refund. The report ...
Nick Pickering's user avatar
4 votes
1 answer
306 views

Where would printer ink go in Statement of Business Activites for tax?

I'm an independent contractor. I bought printer ink for the printer I use exclusively for work. On the T2125 where would it go? I'm guessing either lines 8810 or 8811: "office expenses", or "supplies"....
Latchar3's user avatar
  • 264
4 votes
1 answer
5k views

Candian citizen working for USA company staying in Canada

I am a Canadian citizen. What legalities do I need to follow if I take up a full time remote job offer from a company in USA? Also, how does the answer change if the job offer is in USA (remote) but i ...
Victor123's user avatar
  • 16k
4 votes
2 answers
1k views

Does a European country take out tax from paycheck for a contract employee who is a US citizen?

If a US citizen works in a European country whose currency is Euro for a European company on a contract job (which pays by the hour), does the company take out tax deductions in advance from the ...
mark's user avatar
  • 131
4 votes
2 answers
978 views

How do I best bill out an annualized salary monthly, as a Canadian contractor?

As a Canadian software contractor, what's the best or most accepted method if I've agreed to an annualized salary, to bill it out monthly considering holidays, February being a shorter month etc? Is ...
jdk's user avatar
  • 41
4 votes
1 answer
565 views

How to report 1099-MISC Box 7 bonus ($0 in box 3), but not an independent contractor and not self employed (payment from client of my employer)

I work for a concessions company, but I received a 1099-MISC from the company's client (the team). It's an end-of-year discretionary bonus for taking care of guests of the team as part of my normal ...
Joe S.'s user avatar
  • 41
4 votes
2 answers
1k views

Should my mother be an Independent Contractor or my Employee (for tax purposes) as she provides babysitting services to my young children?

My 65-year old mother lives with us in Florida, and she takes care of our two young children while my husband and I are at work. My husband and I pay my mother about $6,000 a year in cash, and we use ...
Mommy Lorraine FL's user avatar
4 votes
2 answers
481 views

Contractors IR 35 tax burden: is it less than people thought?

With the introduction of the new IR35 legislation in UK, many contractors caught inside IR35 are going to pay more taxes. The most popular tool for the calculation of the tax burden among ...
user1883212's user avatar
3 votes
4 answers
7k views

Contract job (hourly rate) as a 1099: How much would I be making after taxes?

I have an opportunity that would pay me $70 an hour but it would be corp to corp, which as far as I understand would mean I would need to do all my own taxes and Social Security. I live in Raleigh, ...
arinte's user avatar
  • 667
3 votes
1 answer
843 views

Moonlighting as a software developer: employee or independent contractor w/ LLC?

I've made arrangements with a company to do some part time software development help (in addition to my day job, that has full benefits). They are a government contractor (local city governments) and ...
Jim's user avatar
  • 103
3 votes
1 answer
236 views

Can we legally pay my fiancee's mother as a sub-contractor with cash only?

My fiancée and I used to deliver paper routes. A year or so ago we decided to drop the route and transfer it to his Mother who has since been doing the job. The checks are still in my fiancée’s name, ...
Luri's user avatar
  • 31
3 votes
2 answers
3k views

As a director of a limited company in the UK, can I have multiple business bank accounts?

I am a director of a limited company in the UK. I live here and sell my services within the UK. If a bank goes bust, by law, a bank has to protect my deposits to up to £85k. Can I have multiple ...
matewilk's user avatar
  • 876
3 votes
1 answer
456 views

If I pay taxes on my earnings, would someone also pay taxes on the same earnings if I subcontract them and pay a share?

Forgive the confusing title, but it was the best way that I could explain the following situation briefly. I currently have some contracts for doing IT works with various companies. They pay me as ...
canadiancreed's user avatar
3 votes
1 answer
500 views

Why does HMRC still require “payment on account” after I have moved to PAYE?

HMRC has a policy where self-employed individuals must pay 50% of expected income tax & NI contributions in the following year in two instalments due January and July of the current year, which is ...
dvniel's user avatar
  • 1,217
3 votes
1 answer
165 views

Can increasing my tax withholding from my full-time job cover FICA taxes for my freelance work?

According to this article, instead of making quarterly estimated tax payments for freelance work I do on the side, it may be possible to simply increase my tax withholding at my full-time job. I ...
Daniel's user avatar
  • 5,330
3 votes
4 answers
215 views

How hard for US customers make payments to non-resident freelancer by wire transfer?

I'm sole proprietor from Russia. I make projects for US companies. We working fully remote via internet. I'm not US resident. When I try to suggest wire transfer for paying my job my customers don't ...
ThinkBrain's user avatar
3 votes
1 answer
4k views

Can I legally work remotely for a company in UK from India?

I am currently working full-time for a company in India. I got a chance to work in a contractor position remotely for another company in UK. They are willing to pay me to my UK bank account only. So, ...
Midhun's user avatar
  • 31