RE: Anyone ever heard of this book or program

["Russ Seligman" <rseligman -at- enkata -dot- com>]

>3. Find a good small business-focused tax accountant so you only have 
>to minimally worry about the tax end. 4. Hire a payroll service so you 
>don't have to mess w/payroll taxes.

Or, if you do #3, then don't bother with #4 and save the fees you'd
otherwise have to pay the payroll service.  Doing both is like saying,
"I want to pay someone else to deduct taxes from my paycheck instead of
doing it myself."  If you are disciplined enough to tuck away about 45%
of your gross income for taxes, then there's no reason to pay someone
else to do it for you.  But if you can't trust yourself to have that
money available come tax-time, then consider a payroll service.

If your accountant can handle the tax implications of being an
indpendant contractor, just keep good records, skip the payroll service,
and let the accountant handle it. It will make your taxes more
complicated and your accountant more expensive, but that's probably less
than the cost of the payroll service.

Just remember that the money you receive as a 1099 employee (that is, an
independent contractor) does not have any taxes withheld, so make sure
you save about 45% of it for the IRS.  Many a contractor has had trouble
by spending all of their income without preparing for the tax liability.
(This is one reason why "you can make more money as a contractor" is not
as true as it seems).

As an independent contractor, you also have tax deductions available for
business expenses, travel between your home and the client, medical
expenses, and more (all subject to additional limitations). I don't
believe you can claim these if you're "employed" by a payroll service.
Although a payroll service might provide additional corporate benefits
(401(k), insurance, etc.).  It's certainly a personal decision which
route you go.

--Russ


-----Original Message-----
From: bounce-techwr-l-115379 -at- lists -dot- raycomm -dot- com
[mailto:bounce-techwr-l-115379 -at- lists -dot- raycomm -dot- com] On Behalf Of Janet
Murphy
Sent: Wednesday, November 13, 2002 6:56 AM
To: TECHWR-L
Cc: TECHWR-L
Subject: Re: Anyone ever heard of this book or program



Here's a broad brush:

1. Incorporate yourself.
2. Locate a good solid client + 1-2 smaller clients w/ work at hand.
You need to have work right out of the gate. 3. Find a good small
business-focused tax accountant so you only have to minimally worry
about the tax end. 4. Hire a payroll service so you don't have to mess
w/payroll taxes. The payroll service should send quarterly reports to
your tax accountant and auto-submit your payroll taxes to the govt. 5.
Pay yourself 1x a month (that is a big hurdle for most people, but it
minimizes the charges from the payroll service). 6. Network, network,
network. 7. Invest in your business -- buy software, buy a business
phone line, have professional letterhead, take classes regularly.  You
will be competing with the big contracting companies, so be able to
offer what they offer. 8. Don't try to obtain business by [severely]
undercutting on price.  You will regret it. 9. Keep your friends close
and your competitors closer. 10. Set a *reasonable* goal for revenues
the 1st year.  Mine was to work 50% less time while making the same
amount of salary as the agency paid me.  In reality, I work the same
amount or more, but now I'm on my schedule instead of the agency's. I
have the freedom to say "No" to a project.  I can live w/that.

Good luck!!
janet murphy
cincinnati oh.



Wade Courtney wrote:

> <snip>

> I would be interested in any help I can get about going independent.
> I've read the stuff on techwr-l but I want to hear more about getting 
> started and the least painful way to do it.

2. "If you dillydally around and try to please everybody, be it for some
political calculation or some social calculation, it will always to come
back to bite you."
 --- Rush Limbaugh





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