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86 votes
Accepted

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

100% scam. It's not your job to pay other contractors on behalf of the customer. Ask yourself this: If the situation were reversed and the customer was saying he'd pay the other contractor, who ...
Steve-O's user avatar
  • 1,137
53 votes

Contractor wants client to open checking account

While a traditional checking account with the contractor's name on it sounds a bit off, it's not uncommon for private contractors to leverage a construction escrow account for larger projects like ...
Hart CO's user avatar
  • 70.6k
53 votes
Accepted

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

Because you're self-employed and make more than $400, you'll need to file a federal return. If you make less than the standard deduction ($12,400 for a single person in 2020), you won't owe any income ...
Craig W's user avatar
  • 16k
45 votes

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

This could be a scam. This could be unrelated to the original project. It could be a continuation of the original series of events. Or at least that is what they want you to think. There is also a ...
mhoran_psprep's user avatar
36 votes
Accepted

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

Yes. In each quarter the penalty is based on a measurement of the taxes paid vs. the required taxes from January 1 to the end of the quarter in question. As an extreme example, let's say your required ...
Stan H's user avatar
  • 7,716
27 votes

Contractor wants client to open checking account

Scam. The contractor is trying to transfer liability onto you. What makes a contractor accountable for getting the job done is the financial peril he faces if he does not. There's the hypothetical ...
Harper - Reinstate Monica's user avatar
27 votes

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

There is no reasonable scenario where a customer can write one check but not two. Even if they were on their very last check, they are just a few days away from ordering more. It may not be a scam ...
TTT's user avatar
  • 47.2k
16 votes
Accepted

What happens to contractors when employer goes bankrupt?

1: no. You are among the rabble. Because you are a contractor, i.e. another business. This is part of the deal of being a contractor - you control your busienss and are responsible for your risk. And ...
TomTom's user avatar
  • 11.5k
13 votes

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

It sounds really fishy to me. I recommend looking up the company's contact information using Google and ask them about it. They may have no idea this is happening because whoever contacted you is a ...
Kevin Peter's user avatar
12 votes

Hiring Foreign Contractors - Is This Tax Deductible?

Your premise is incorrect: I believe if they were US based contractors I would need to send them a form to do my own deduction. If it is a legitimate business expense, you can deduct it regardless ...
TTT's user avatar
  • 47.2k
11 votes

Contractor wants client to open checking account

TL;DR: No. There is no legitimate reason for doing this. It's trying to replicate the invisibility of a cash job with the convenience of not having to lug around briefcases full of cash, with the ...
Rupert Morrish's user avatar
8 votes
Accepted

Mother wants me to "be a consultant" for her as way to save on income tax

In reality, I do help her every now and then with various bits (specific to her work, e.g.: translation, graphic design, software tutorials) but I would not think of it as consulting... But you are ...
RonJohn's user avatar
  • 50.7k
7 votes

What happens to contractors when employer goes bankrupt?

Exactly the same thing happened to me. Short answer: Don't hold your breath waiting for the money. Under US bankruptcy law, there is a long list of priorities for who gets paid first. Yes, "secured ...
Jay's user avatar
  • 22.8k
7 votes

W-2 contractor loopholes

To be clear, if you are receiving a W-2, you are an employee, not a self-employed contractor. Before the new tax reform law, it was possible to deduct unreimbursed employee expenses. These were ...
Ben Miller's user avatar
  • 116k
7 votes
Accepted

Excess Social Security Witholdings

I wrote about the Social Security overlap when switching job a long time ago. Your situation is essentially the same. Each employer is required to withhold FICA taxes to the full extent, and it doesn'...
littleadv's user avatar
  • 178k
7 votes

Contractor wants client to open checking account

While I wouldn't do it it might not be a scam. Rather, it could be the contractor is attempting to hide money and doesn't want accounts in their name. Maybe the IRS is after them, maybe they have a ...
Loren Pechtel's user avatar
7 votes

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 found this article which seems very relevant: The scam works like this: Contractors knock on doors offering to inspect homeowners’ roofs for storm damage. They say they can help get a roof ...
JimmyJames's user avatar
  • 3,888
7 votes

Time limit on sending invoices in the United States

Is there some time limit to sending the invoice, such that it is invalid and the recipient is not obligated to pay it? Yes, there is. The term you are looking for is Statute of limitations. Basically,...
sleske's user avatar
  • 302
6 votes
Accepted

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

I've been in a similar situation before. While contracting, sometimes the recruiting agency would allow me to choose between being a W2 employee or invoicing them via Corp-2-Corp. I already had a ...
TTT's user avatar
  • 47.2k
6 votes

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

You got this gist of it. However, I don't see anyone mention the Earned Income Credit. I want to say you need to be at least 25, but am not 100% sure on that. https://www.irs.gov/credits-deductions/...
Jim M's user avatar
  • 61
6 votes

Should a freelance programmer charge me for hours spent where a computer was running a script?

Would you have been happy had, say, the developer gone to bed or gone to a movie while the script ran? Even if the script was generating errors or causing the CPU on some machine to spike or causing ...
Justin Cave's user avatar
  • 27.8k
5 votes

Excess Social Security Witholdings

They have to withhold. When you file your taxes there is a line item to refund overpayment. Fairly trivial.
Eric's user avatar
  • 314
5 votes

Independent contractors and new U.S. tax law

The new tax law provides a 20% deduction for income from pass-through entities (for next 8 years). So whether you keep operating as a sole-proprietor or establish an LLC,partnership, etc. you'll ...
Hart CO's user avatar
  • 70.6k
5 votes

Hiring Foreign Contractors - Is This Tax Deductible?

If you want to be extra sure, get them to sign a W8-BEN form and keep it on file. I have talked to the IRS about this, and they agreed it's generally unnecessary when dealing with a corporation but ...
Spehro Pefhany's user avatar
5 votes
Accepted

Do I need to exchange my EU income (Euros) to GBP to get taxed in the UK?

At some point you will be required to pay some taxes to HMRC. That bill will have to be paid in UK pounds. That is the only exchange to pounds you will need (apart of course from anything you need to ...
DJClayworth's user avatar
  • 33.8k
5 votes

Should a freelance programmer charge me for hours spent where a computer was running a script?

I work for a consulting company where this comes up fairly regularly. The litmus test for us is this: Could the individual running the script reasonably go work on something else while the script runs&...
JohnFx's user avatar
  • 53.1k
5 votes

Does side-job with W-9 get listed as 2nd job in W-4 for new job?

You should use the W4 estimator to figure out how to fill your new W4. Generally speaking, W4 is intended to instruct your employer how much to withhold, and you can check the "2nd job" ...
littleadv's user avatar
  • 178k
4 votes
Accepted

Independent contractor rates for web development

First off, you should charge whatever you can charge, as @Dheer says in comments. However, that's really not on topic here. What is on topic is how the 'contractor pay' compares to 'salary pay', and ...
Joe's user avatar
  • 35.9k
4 votes

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

The bank has to protect the total of your deposits with them, not each individual account. You'd need the second account at a different bank to make this work. It is presumably less likely that two ...
Rupert Morrish's user avatar

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