Employee or Independant contractor?

Question

I have read what criteria constitutes an employee versus a contractor. I am 90 percent sure I fall under the catagory of an employee. I worked as a residential trim carpenter "quit last monght", not sure if that makes a difference or not. My "boss" is sending me a 1099. Under the 1099, I am pretty sure I end up paying more taxes right off the top. Is there anything I can do to disputre this 1099? Any help would be greatly appreciated. Thank You... Dan

Answer 1

I do not know what criteria you are using to determine if you are employe versus and independent, but a great deal of that is also determined by you agreement with the company/ person that you are working for.
You are correct - you will pay more out if you are 1099'd versus a W-2 employee. You will be responsible for your entire 15.3% FICA contribution and taxed as a sole proprietor (you are now your own "business").
You will most likely need legal council to determine whether you have a recourse against the company you worked for. My suggestion is also that if you intend to continue as an independent contractor to consider incorporating yourself into an S-corp, much nicer on the tax bills.

Answer 2

I would say that an employee payes taxes and works on a wage bases.
Independent contractor receives a payment to perform a service and does not have taxes deducted from his payment cheque. He must pay his own contributions to the government.He does not collect holiday pay or severance payments.
Independent contracts perform a service. Employees are part of the corporation and work towards the common goals of the organization.

Answer 3

and you would be wrong. right off the top you pay less. if you didn't know and you got a 1099 you haven't paid social security or any taxes yet. you pay about 15% social security but deduct half as an expense deduct 45 cents per mile, tools meals cloths etc and pay overall your pay a 5% higher rate but are taxing 40% less income basically if you are an independent contract er you just got a tax free 30% raise

Answer 4

I am an independent contractor. I think the basis for a legitimate argument on your part is fairly simple:

When you were paid, were there any taxes, unemployment, FICA or other deductions on your check? As a contractor, there shouldn't have been - as an employee, the company is mandated to take these out.

Answer 5

did he take out taxes for you during the year? i think no, so yes you pay 14% self-employment tax...... it sux.......you can do nothing, sorry.....