Re: Anyone ever heard of this book or program

["Richard G. Combs" <richard -dot- combs -at- voyanttech -dot- com>]

In response to Janet Murphy's 10-step program, Russ Seligman wrote:

> >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.  <snip>
>
> Just remember that the money you receive as a 1099 employee (that is, an
> independent contractor) does not have any taxes withheld, so  <snip>
>
> 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.

Russ, you overlooked Janet's step 1: "Incorporate yourself." She's not
talking about being self-employed (1099) or being an employee of an agency.
She's talking about being an employee of _a company you own_. The payroll
service is just someone your company contracts with to provide
payroll-related bookkeeping services; you don't work for _them_, they work
for _you_ (well, for your company). :-)

Janet's step 1 is an excellent idea, BTW. An S corp. works well for most
people, but other options such as an LLC or PC may be possible. A corporate
entity gives you at least three advantages over being a self-employed
individual:

-- A more professional image and greater credibility/acceptance. Some
companies that won't directly contract with an individual will contract with
your company for your services.

-- Payroll tax savings. If you net $80k of self-employment income, you pay
payroll taxes (SS/Medicare) of 14.3% on all of it -- over $11k. If your
corporation nets $80k, it can pay you, say, $50k salary; the remaining $30k
is profit to the stockholders -- that's you. But you don't pay payroll taxes
on the profit distribution, only on the salary. So you save 14.3% of $30k --
over $4k.

-- Free pens and stuff. You'd be amazed how many companies will send you
free samples of pens, calendars, day planners, etc., personalized with your
company name, in the hope that you'll order a few thousand as marketing
tools. :-)

Richard


------
Richard G. Combs
Senior Technical Writer
Voyant Technologies, Inc.
richardDOTcombs AT voyanttechDOTcom
303-223-5111
------
rgcombs AT freeDASHmarketDOTnet
303-777-0436
------










^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Order RoboHelp X3 in November and receive $100 mail in rebate, FREE WebHelp
Merge Module and the new RoboPDF - add powerful PDF output functionality
to RoboHelp X3. Order online today at http://www.ehelp.com/techwr-l

Check out SnagIt - The Screen Capture Standard!
Download a free 30-day trial from http://www.techsmith.com/rdr/txt/twr
Find out what all the other tech writers, including Dan, already know!

---
You are currently subscribed to techwr-l as:
archive -at- raycomm -dot- com
To unsubscribe send a blank email to leave-techwr-l-obscured -at- lists -dot- raycomm -dot- com
Send administrative questions to ejray -at- raycomm -dot- com -dot-  Visit
http://www.raycomm.com/techwhirl/ for more resources and info.