What do I need to fill out as an independent contractor?

Question

I'm a new Independent Contractor in CA for an online company, what forms do I need to fill out or can soemone help guide me through what I need to do legally? I've never been self- employed and need help.

Answer 1

For your tax return, you'll enter your income and related expenses on a schedule C or C-EZ, then fill out a schedule SE to calculate your self-employment tax - that's for social security and medicare. The numbers from the bottom of the schedules will transfer to a form 1040.

You might want to download the 2006 forms and instructions now, and take a look at them, so you know what you'll have to do next year at tax time.

You'll file quarterly estimated returns on a form 1040-ES.
You've already missed the deadline for the first quarter, but if you divide your expected tax by 3 and send in that much for each of the next quarterly payments, you'll be OK.

Answer 2

What you want to take into consideration is whether or not you want to pay taxes upfront, or after the fact. If you anticipate making a large sum of money, then you may end up owing a lot in taxes and getting that together may be difficult.

You don't really need to do anything now...you need to worry about it when you file next year. They must send you a 1099. They must do so by January 31st of next year.

You should be keeping track of expenses such as, phone, internet, advertising, gas mileage, work attire, equipment, etc. Any business expenses. These should all get written off at the end of the year.

Good luck with online business. Becareful not to get scammed. I recommend you search the rip off report websites to see others experiences with the company you are getting involved in.

Answer 3

Your best bet is to go to the IRS website. They have the forms for self employed to pay their Social Security monthly or quarterly, the state tax and the Fed tax withholding. Also they will have the forms for the end of the year taxes.
It is actually pretty easy, you really only have to decide to call yourself a homebased business, or self-employed.I think self employed is easier to keep up with.. someone correct me if I am wrong :)