Hourly

[st8]

priyagc:
A $50/hr earning would potentially yield a gross of 70-80K per year pay. For every dollar you make beyond $50, one probably will not pay social security (as upper limit of 87K probably reached) which results in a gross savings of about 13% of the extra dollars. Fed, state and medicare still need to be paid on this amount though.

Health insurance costs cannot be deducted but are applied pre-tax (no taxes paid) and also reduces your net tax payable.

Independent consulting has room for some biz expenses deduction thereby reducing the taxes to be paid.

 

[sajyra]

useful

This thread turned out to be a real useful for someone who is planning to start as a Indipendent consultant. Now I learnt intricacise of being self-employed.

Thank you all

 

[waitingforaos]

1099 VS W2

Most of us are talking about independent contracting. Hwat if we go hourly with W2 instead of 1099 . I know that only if you are 1099 can you deduct personal expenses. What is the deal with W2 hourly. Do we still have to pay 15%social security. I am planning on going W2 salaried and not 1099. I know I would not be paid for holidays and no vacation time and have to bare all the medical expenses. Is there any advantage on going W2 hourly

 

[roran]

Re: 1099 VS W2

Originally posted by waitingforaos
Most of us are talking about independent contracting. Hwat if we go hourly with W2 instead of 1099 . I know that only if you are 1099 can you deduct personal expenses. What is the deal with W2 hourly. Do we still have to pay 15%social security. I am planning on going W2 salaried and not 1099. I know I would not be paid for holidays and no vacation time and have to bare all the medical expenses. Is there any advantage on going W2 hourly

This is what I am exactly doing now, W2 hourly. The company pays Social Security. When I negotiated in the beginning, I took into consideration, vacation, sick leave, medical, benefits etc., I do not know about the advantages of W2 over 1099. I just thought I will start going 1099 after GC.
But, (un)fortunately I am going to join Full Time with my client soon.
As somebody pointed out, you cannot write off expenses(mileage,parking,lunches, car lease etc.,) in W2 hourly as in 1099.

 

[priyagc]

re:Girish

Thats a fairly good explaination abt the costs that an employer need to take care of.

It seems that u own a company. Do u sponsor H1's for new people? Also did u setup the company as an S-Corp or LLC. Can you suggest me some lawyers/tax consultants who can help me in making this decision.