What are my options?

[Alta Al]

Hello Posters;

I am a CSA working on my 3rd TN, which will expire in Jan. My employer has expressed that he wants to keep me working but he has decided to reduce overhead and wants to make all employees to contractors. My understanding is that I can not incorporate in the US and become an independent contractor, and still work under the TN.

What are my options?

Alta Al

 

[gunt]

you can work as an independent contractor and get a 1099 IRS form rather than a w2 while on a TN. However your TN letter still has to say that "XXX company will be hiring you for 365 days to do YYYY." Do not mention anything in the TN letter about contractor or such. Many people work under a 1099 while on a TN.

 

[Alta Al]

Are you one of these "many people" on a TN that files a 1099 instead of a W2?

I didn't pay much attention to your signature, so I will rephrase my question.

When you were on a TN, did you file as a 1099 or a W2?

 

[gunt]

i have filed with W2s and with 1099s in the past. The only issue to be aware of is that with 1099 you are responsible for paying the EMPLOYER share of Social Security and Medicare as well. Also since 1099 has no withholding tax throughout the year, you could end up with a large tax bill in April and have to pay penalties as well. To avoid this you have to make Estimated Tax Payments every quarter in leu of withholding tax.