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Author: WMM2 Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 49512  
Subject: Re: 1099 or W-2 employee? Date: 3/13/2003 3:48 PM
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The 1099 refers to the statement that you will get at the end of the year, telling how much you were paid. You have to pay income taxes on the amount, just like any other job.

Some of the things you need to know.

They won't withhold income taxes, so you will have to file quarterly estimates (form 1040 ES) with the IRS. If you have state and local taxes, they too may require quarterly estimated payments.

They don't pay or withhold social security taxes. You have to pay both your portion and the part that an employer would pay in a w-2 job. (like your day job).

You can deduct a lot of stuff that is required for the job. (Like the long distance phone calls. The basic phone service doesn't get written off, according to my tax guy)

There's a lot of stuff you need to keep records on if you want to deduct it. I suggest you run this by an accountant or tax person.

===================================

Now having said all that, are you sure you want this job? Look at it from a customer's point of view. If you got a long distance cold call, asking all sorts of personal questions (like you would have on a credit application) would you give out that information? I know I wouldn't. I suspect you might end up spending a lot of time and money making long distance calls with little or nothing to show for it.

Good luck with whatever you do.

Bill
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