[sawingzzzz's]

I am an SRNA who is doing research into what I want in a position. Does anyone have experience with 1099 positions? I realize the salaries are higher as one purchases their own benefits and insurance. My question is are there enough deductions for a person to come out ahead in this situation? What are the pit-falls one must look for in the contract?
Personal experiences and opinions welcome!

[Geeg]

I can't comment on the 1099 part. If this setup is with a hospital, be wary. The hospitals act in only one interest: their own.

[mandana]

Can't comment on the contract part, but I will tell you that being a 1099 employee can be financially disastrous unless you're well aware of certain things. My husband just took a new job because the 1099 position he had previously was killing us.

1. You will be taxed at a much higher rate because there is not an employer matching your taxes. In our case, this was at least 30% annually.

2. You have to pay estimated taxes quarterly. If your salary fluctuates, this can leave you paying either way too much (which stinks because the IRS has your money for a year) or way too little (which results in you owing the IRS at the end of the year).

3. You have to have A LOT of deductions for it to even come close to touching what you owe. We have pretty much every deduction you can think of, and we still ended up owing them money.

4. Purchasing your own benefits is not that great of a deal. We thought it would be easy since none of us have any pre-exisiting health problems, but it was very expensive for a pretty crummy policy that only covered major medical. Not to mention, we were totally on our own for life and retirement which is fine if you're a fiscally responsible person, just didn't work out so well for us!

5. The biggest thing that sucked was time off - since his boss never paid attention to how much he worked in regards to time spent, it was always a big b*tch fest when he needed time off. That was probably more of a personal issue than you'll encounter/

It can be done, but I don't think it can be done by everyone. If the above things sound tolerable to you, then it will be fine.

good luck,
Amanda

[marc123]

I used to be an accountant, 1099 can be OK if you are disciplined enough to withhold a portion of your paycheck to pay your employmet taxes.

The contract hourly rate may seem like more than what you would get paid if you are full time employee, but it may ony reflect the normal hourly rate plus employer portion of employment taxes.

With the savings by the employer some (if asked) may provide a stipend to put towards private health insurance. In that case you may want to set up a MSA.

If being 1099 is a good deal or not depends on what you think your tax bracket will fall into the time you work in that capacity as well as what deductions you may be able to take advantage of.