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Trying to decide if I would like to be an independent contractor

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  • Trying to decide if I would like to be an independent contractor

    So I am wondering if it would be better for me to be an independent contractor or stick with being an employee. I provide my own tools and set my own schedule. I get no benefits just make commission. I am thinking about going I.C.so I can deducted my grooming expenses. Do I need to pay for workman's comp? Ill have to see about insurance. Then would I ask for a raise in my commission rate?

  • #2
    If you are an employee, then you are covered by your employer for workers compensation and unemployment insurance. Also, half of your medicare and social security deduction is being paid for by your employer.
    When you are an IC, you pay the whole of your medicare and social security deduction instead of half -- this is the Self-Employment (SE) tax. You can purchase workers compensation insurance, but I think most IC's choose to rely on their health insurance instead. When you collect sales tax, you must file returns for the sales tax, and send a check for the amount of sales tax that you collected.

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    • #3
      You can deduct your grooming expenses as an employee as well. There's a separate form on your taxes for non-reimbursed employee expenses. There was a discussion a few weeks back about it.

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      • #4
        I dont think you can go from being an employee to an IC within the same company...plus theres more to it than just what you are talking about. You need to do research.
        <a href="http://www.groomwise.typepad.com/grooming_smarter" target="_blank">My Blog</a> The two most important days in your life are the day you are born and the day you find out why. –Mark Twain

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        • #5
          Thanks for the feedback. I do plan to do a ton of research on this, just thought it would be helpful to ask you guys first.

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          • #6
            Originally posted by anaelmer View Post
            Then would I ask for a raise in my commission rate?
            If you are to truly be an independent contractor you would pay rent for the space you use.

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            • #7
              ...And have your own phone line, separate client files, etc.

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              • #8
                if the shop has one groomer as an employee, they cannot have another as an IC from what was explained to me...also, its more than ust taxes to consider. You CAN deduct your business expenses on your taxes if that s your concern...http://www.irs.gov/publications/p529/ar02.html
                <a href="http://www.groomwise.typepad.com/grooming_smarter" target="_blank">My Blog</a> The two most important days in your life are the day you are born and the day you find out why. –Mark Twain

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                • #9
                  UGH! I would love to just rent out and have my own phone line. It would clear up all my issues with scheduling,lol. But its looking like IC is not an option form what you all say. See you guys saved me a ton of time!! Thanks, I will check out that link @Particentral sent me too.

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