would being self-employeed effect citizenship eligibility?

[StayPositive]

Since you need to stay with (hopefully) your original employer after you became a GC holder, then would being a self-employeed person make any negative impact on becoming a lawful citizen at the end of day?

Thanks for your insight!

[dsatish]

Working on 1099 or working for another company (leaving the GC sponsor) are one and same (similar situations). So if you believe that leaving the sponsor is risky, then working on 1099 is equally risky. If you don't believe that leaving the sponsoring employer is not risky, then working on 1099 is not risky. I am currently working on 1099.

[qwertyisback]

Originally Posted by dsatish

Working on 1099 or working for another company (leaving the GC sponsor) are one and same (similar situations). So if you believe that leaving the sponsor is risky, then working on 1099 is equally risky. If you don't believe that leaving the sponsoring employer is not risky, then working on 1099 is not risky. I am currently working on 1099.

q/s regarding 1099... I have worked w2's and 1099's in the past.. Whats your calculation regarding w2's and 1099's?? If somebody ready to pay $X on w2, how much that employer can pay on 1099 equivalent $X+5 ???

Also compared to permenent job, whats the 1099's comparable rate should be??
e.g if somebody gets $X/per hr + benefits(health mainly), whats its comparable with 1099?? $X+10??

[AmericanWannabe]

Originally Posted by qwertyisback

q/s regarding 1099... I have worked w2's and 1099's in the past.. Whats your calculation regarding w2's and 1099's?? If somebody ready to pay $X on w2, how much that employer can pay on 1099 equivalent $X+5 ???

Also compared to permenent job, whats the 1099's comparable rate should be??
e.g if somebody gets $X/per hr + benefits(health mainly), whats its comparable with 1099?? $X+10??

with 1099, you have to pay 15% SS tax on yoru own. With W-2,
the employer pay half of 15% for you.

[pv1976]

Originally Posted by qwertyisback

q/s regarding 1099... I have worked w2's and 1099's in the past.. Whats your calculation regarding w2's and 1099's?? If somebody ready to pay $X on w2, how much that employer can pay on 1099 equivalent $X+5 ???

Also compared to permenent job, whats the 1099's comparable rate should be??
e.g if somebody gets $X/per hr + benefits(health mainly), whats its comparable with 1099?? $X+10??

Well..since you've worked on both in the past, why dont you post the percentages that you had (if you r willing..). Meanwhile lets wait what dsatish says.

[qwertyisback]

Originally Posted by pv1976

Well..since you've worked on both in the past, why dont you post the percentages that you had (if you r willing..). Meanwhile lets wait what dsatish says.

Have you read my post ??
I already told, $X+5(for W2 to 1099) and $X+10(For permenent to 1099),

[dsatish]

Originally Posted by qwertyisback

q/s regarding 1099... I have worked w2's and 1099's in the past.. Whats your calculation regarding w2's and 1099's?? If somebody ready to pay $X on w2, how much that employer can pay on 1099 equivalent $X+5 ???

Also compared to permenent job, whats the 1099's comparable rate should be??
e.g if somebody gets $X/per hr + benefits(health mainly), whats its comparable with 1099?? $X+10??

As a thumb rule, 1099 rate should be 10% more (1.1 times) the W2 rate assuming that you won't get any medical benefits or vacations on W2 also. With 1099, you will pay 7.5% extra on Social Security taxes. Also add 2.5% towards the employer's expenses to process your payrole,pay work man's compensation insurance etc. That's why employer reduces the 1099 rate by 10 to 11% if you get paid on W2.
For medical, deduct the hourly rate at the rate of $1.5 per person. If you have no kids, then deduct $3/hr (you and your wife). If you have 2 kids, then deduct $6/hr from your hourly rate (if the employer pays the full medical).

Some sample calculation for a 1099 rate of $60/hr
-----------------------------------------------
1099 rate = $60/hr (no medical)
W2 rate = $54.5/hr (no medical)
W2 with full medicalbenefits for family of 3 = $50/hr (approx)
Annual Salary = 90K per Year. (Deduct 10K from W2 converted rate because of vacation, 401K etc).

[qwertyisback]

Originally Posted by dsatish

As a thumb rule, 1099 rate should be 10% more (1.1 times) the W2 rate assuming that you won't get any medical benefits or vacations on W2 also. With 1099, you will pay 7.5% extra on Social Security taxes. Also add 2.5% towards the employer's expenses to process your payrole,pay work man's compensation insurance etc. That's why employer reduces the 1099 rate by 10 to 11% if you get paid on W2.
For medical, deduct the hourly rate at the rate of $1.5 per person. If you have no kids, then deduct $3/hr (you and your wife). If you have 2 kids, then deduct $6/hr from your hourly rate (if the employer pays the full medical).

Some sample calculation for a 1099 rate of $60/hr
-----------------------------------------------
1099 rate = $60/hr (no medical)
W2 rate = $54.5/hr (no medical)
W2 with full medicalbenefits for family of 3 = $50/hr (approx)
Annual Salary = 90K per Year. (Deduct 10K from W2 converted rate because of vacation, 401K etc).

Thanx for info. What about forming business(I think anybody can get incorporated under some business name) and get paid to that business instead of on 1099. Does business owners has to pay SS? And does it any way benefit over 1099?? Have you thought about it?? As business owner, I guess you can put lot of items as tax deductible...

[dsatish]

Originally Posted by qwertyisback

Does business owners has to pay SS? And does it any way benefit over 1099??

One has to pay SS tax on his salaried income , not on profit. So as a business owner, if you earn 100K , but pay yourself only 60K and show remaining 40K as expenses + profit, then you need to pay SS tax only on 60K.
But you need to pay corporate tax(higher) on the profits. Ofcourse if you can come out with more deductions and less profits, then it works out better, but you need to be careful about how you justify the expenses. Another benefit of starting a business is that you can invest upto 25K / year in 401K without paying any tax on that profit.
The reason i have not incorporated is that i am not planning on working as a consultant for long. I would like to take up a full time job soon. If one has long term plans to work as a consultant, then starting an S corp is good.