Cons to a 1099 Position?

Daneil3144

Recently offered this Part Time - Work From Home Position for a Start Up Company, that is also a 1099 Position.

I would essentially be paid $20 for each customer I assist.

Probably between 5-10 customers a week.

Mostly e-mails, and then finally confirming via webcam that everything was done.

Extra chump change is nice - but mostly looking to fluff my resume. (At first I was like - in my mind - can I put it on my resume - Do people put Uber on their resume :P

Are there any cons that I am overlooking in accepting a 1099 part time positing?

EANx

You don't say but I assume you're in the US.

On a part-time basis, augmenting a current job, there are few downsides. You'll have to remember to pay not just income tax but both the employer and employee sides of social security. You might also want to take a close look and see if professional liability insurance is something to get. It really all depends on the type of customers you would be assisting. Even if it's home users, a goof on your part at the wrong time could result in loss for the customer that they might come to you for recompense.

Dojiscalper

I think thats most of the con's. I do almost 100% 1099 work full time, and while its true that you pay both sides of social security, medicare taxes, you get to deduct a large portion of the social security tax as an expense and additional business expenses so I wouldn't worry about it if its just something you want to add to your income by doing. Just go for it. You can easily pay the "self employment tax" social security + medicare quarterly so your not looking at a bill every year.

TechGromit

Your responsible for all the taxes is the biggest downside. In your case it's not a major concern, because it's side business, but I do know someone who got themselves 40k in debt with the IRS because they were not setting enough aside to pay there taxes on a 1099 contract.

shochan

Best thing to do is to save 1 or 2 paychecks back only for taxes & you should be good. IF you can afford to do that. If you cannot, I would suggest taking out 25-30% on each paycheck & put it in a savings account and don't touch it. Then when tax time comes around you can pay your taxes to the tax man right then.

Basic85

As everyone said on here, it's paying your own taxes. It's not that bad but you just have to keep track of your expenses such as gas if any, supplies, etc and you can do that by keeping all of your receipts. Also there may be an app for that, to keep track of receipts for 1099 employees that you may want to research.

Daneil3144

So essentially I would be making $20 an hour and not $15 an hour, correct?

shochan

yeah, let's say if you were working a $70k job...you are only netting $50k yr...yeah, $20k in taxes...

EANx

Daneil3144 wrote: »

So essentially I would be making $20 an hour and not $15 an hour, correct?

Yes. They're paying you $20 per hour and expecting you to pay everything that needs to be paid out of that.