[thechat] US Contract Gig - Tax Questions

[Matt Warden]

First, I am not a tax lawyer. You should consult one and not rely on me. :)

W2 work requires employers to pay half of payroll taxes. It also
requires employers under most circumstances to withhold estimated
taxes based on IRS tables.

1099 work requires you to pay full payroll taxes. You should factor
this into your rate. It is common that companies will request a W2
rate and a 1099 rate, and they expect the latter to be higher. Also,
no one is going to withhold your estimated taxes, and you are required
to submit estimated taxes on a quarterly basis.

-- 
Matt Warden
Austin, TX, USA
http://mattwarden.com


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On Wed, Sep 29, 2010 at 3:11 PM, Luther, Ron <Ron.Luther at hp.com> wrote:
> Hi Folks,
>
> I figger somebody here (if there *is* anybody here anymore) might know the tax implications of taking on a contract job - versus normal employment.
>
> Do contractors get hit with extra SS and Unemp taxes?  That kind of stuff.
>
>
> Big Thanks,
> RonL.
>
>
>
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