Re: Contracting Experiences

Subject: Re: Contracting Experiences
From: "Moore, Tracey" <TMoore -at- PARKERVISION -dot- COM>
Date: Tue, 6 Apr 1999 10:28:33 -0400

It can vary. Last year about 1/5 of my salary was 1099, the rest was
W-2. This year will probably be 50/50. I like 1099 better, provided I
can work from my home (of course, W-2 working at home ain't so bad--I
have one client who prefers it that way--love her!).

If they want me to be on site 40 hours a week, I prefer W-2. Being on
site, using their equipment and acting like a regular employee, leaves
you with less to deduct in the way of expenses--and deductions are what
you need with 1099 to avoid being eaten alive with taxes.

Direct client work doesn't necessarily mean 1099 (but usually does), and
being on site doesn't mean W-2 either. W-2 helps to cover the client's
rear end with the IRS if you're working on site. The line between
contractor and employee gets more and more difficult to prove when
you're REQUIRED to be on site.

Andrew, please correct me if I'm wrong about any of this contracting
stuff. Don't let me hang out here flapping in the wind, you contracting
god!



-----Original Message-----
From: Suzanne Pyle [mailto:comline -at- greennet -dot- net]
Sent: Tuesday, April 06, 1999 10:29 AM
To: Moore, Tracey
Cc: TECHWR-L -at- LISTSERV -dot- OKSTATE -dot- EDU
Subject: Re: Contracting Experiences


Tracey, I'm wondering if you could tell us during a typical year, how
much of
your work is direct (1099) client work, and how much do you obtain via a
recruiter (W-2)?

Suzanne

Moore, Tracey wrote:

> A good point was made that contracting is largely dependent upon one's
> personality. People always assume that because I am a contractor I
make
> TONS of money. Well, that's not the case. I make slightly more than I
> did as a captive employee. I don't get paid for time off, sick leave,
> etc. I have to pay my own expenses and benefits.
>
> As a contractor, I often spend a lot of time meeting with potential
> clients discussing a proposed project, doing lots of follow up,
seeking
> out new work, all of which I don't get paid for. I also have to pay
for
> my own educational expenses, very rarely will a client send you to a
> class or purchase training materials--they expect you to bring to the
> table what they need.
>
> As for experiences with recruiters: I have had the "bench time" offer,
> only to have them renig just before hiring me, stating they only do
that
> for this title or that title. I wouldn't count on bench time. If you
get
> it, then be pleasantly surprised.
>
> If you have to work on the client site 40 hours a week, it's very much
> like a captive job. Every contract I've had through a recruiter has
been
> like this. It offers less freedom than a contract you obtain on your
> own, where you can define your requirements.
>
> You inquired about taxes. If you go with a recruiter, you'll most
likely
> be a W-2 employee as you are now--so there's nothing for you to do. If
> you go 1099, you have to be sure to submit your quarterly estimated
tax
> and keep track of all business expenses. When figuring your hourly
rate,
> consider your expenses and taxes--that's where people go wrong. I'd
> definitely consult with an accountant or attorney regarding the
> benefits/costs of going 1099 vs. incorporating. It depends upon your
> situation.
>
> So this all sounds so negative, eh? I don't mean to be. Contracting
> offers you something no captive job will: FREEDOM. I have a programmer
> friend who said it best: "I've been offered full-time employment, but
> when it comes down to it they can't offer me what I have: a good
hourly
> rate and six weeks off every year."
>
> Good luck!
>
>
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