I would see a CPA and an attorney and get yourself set up as an S-Corp. Then call up a company like APS or Paychex and have them set you up as an employee of your own company. That way, if things get slow, you can lay yourself off and collect unemployment. As an S-Corp you can also pass through your business taxes to yourself as an individual and pay less that way by taking part of your pay via dividends. Your CPA will explain that to you better than I can. Just make sure you pay yourself about the average wage for someone in your position. If you try to "under-pay" yourself, the IRS may nail you for trying to evade taxes by taking untaxed dividends instead of wages.
As a sole employee of your company or with just your wife, etc., then you only have to pay yourself once a month since Paychex charges like $70 every pay period. Neat thing is that you can also get some benefits this way as they offer those services too. Another cool thing is that you can set your wages. Need to buy a house but don't show enough earned income? Just tell Paychex to pay you an extra $1,000 or whatever you need that month. The way they do payroll is to send you your post-dated paycheck just as you would get from a regular employer. Then, on the date stamped on the check, they hit your business account for payroll. You can also do Direct Deposit so that the money just jumps from your business to personal account in less than a day.
Most importantly, if you have kids and are 1099ed you really need to do this because then you can become eligible for the EITC again. Since you set your wages, you could also pay yourself the right amount to max out your EITC. Your CPA will advise you how to do this properly. Just make sure to bring it up with him or her.
Re: 1099 Help!!!
Member #: 40846
Registered: 9/19/2005
Posted:
1493
Name:
Duane Vick
Name:
Duane Vick
Company:
Self-Employed
Occupation:
Installer
Location:
Phoenix AZ
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