SE withholds oasdi/medicare, IC w/holds nothing.
Posted By: nm on 2009-03-30
In Reply to: Question on IC and statutory.. - hoping for the better
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Social Security & Medicare
Here's the scoop: As an IC, you are responsible for all 15.3% of your combined social security (12.4%) and medicare taxes (2.9%).
As a statutory MT or a full employee, the MTSO will pay half, or 7.65%, of your social security and medicare taxes. It is only as an IC or statutory that you are able to fully deduct your home office-related expenses on your tax return. I think an employee can only take SOME of the home-office write-offs, but I am not sure which ones.
Also of note is that only the first $92,000 of your income is subject to the SS and MC taxes (not that many of us make this much, but it's good to know!) However, you are only required to report your income if you made over $400 that year.
When you file your federal taxes at the end of the year, you will have to pay a self-employment tax which is what takes care of your SS and MC taxes.
If you expect to OWE more than $1000 in self-employment taxes at the end of the year, then you will actually need to make quarterly estimated tax payments or risk paying a penalty fee when you file annually. To compute that, I believe that you would owe more than $1000 in self-employment taxes if your taxable income is more than $6500 per year (which hopefully includes nearly all of us!).
If you can find a company who will treat you as an IC (not binding you to specific schedules, etc) yet will hire you to a statutory position, then this, in my opinion, is the way to go.
For instance, I currently work for two companies, one as an IC and one as statutory. They both pay me the same per line, but since the statutory one also pays half of my SS and MC taxes, it's like taking my line count and adding 7.65% to it!
You may ask why I don't just go full-time with the statutory--the answer is this: My IC account has a lot of standards, so I actually make about the same, if not more, even after I consider the fact that I am responsible for all of my taxes for income made with this account.
Hope this helps to answer some of your questions!
ANY federal money - included Medicare and almost
I could be wrong, but I read it to mean ANY federal money which includes Medicare/Medicaid, and there are probably not too many hospitals, clinics, or private doctor's offices that do not have at least 1 Medicare/Medicaid patient. Seems to me they would not be too worried about all the listed countries for off-shoring if it was only VA, since there was already a big stink about off-shoring VA records. But then, as I said, I could be reading it wrong. I guess only time will tell.
My understanding was that in order to receive Medicare/Medicaid payment sm
providers will be required to have EMR.
They still do now, but I don't know what the future holds. NM
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As a QA person who holds only 1 job SM
I have to say this is absolutely true. I never realized how many double/triple/quadruple dippers we have out here--people literally working for up to 4 companies during the same hours and making hourly pay for each of those companies. That is why there has been a move to production QA pay--as usual the few cheaters have ruined it for the others.
I at least have a clear conscience--and if my company moves to a production QA department, I can still make my money because my mind is 100% on the 1 job I have.
All of them, its not the company that holds you back
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WHAT? No one holds you back from being professional! OMG!
Talk about utter lack of accountability and responsibility!
You don't have a clue about running a business, the cost of capital, etc.!
You are an angry little person, huh?!
They do these 'hard holds' without ANY warning (sm)
I had no idea there was ANY problem with my account until I went to use my ATM card at the walk-up machine and, of coure, the bank was closed. I knew I had well over $500 in there but had to wait until I got home to call their customer service number and inquire as to the problem. No amount of reasoning, rationalizing, begging or pleading would persuade them to even release a measly $40 so I could fill up my gas tank and eat, either. I withdrew all of my funds and closed my account as soon as they released their almight 'hard hold,' that's for sure.
I've had accounts of B of A, Bank of the West, Sanwa Bank, etc., and NEVER have been through anything as preposterous and humiliating as the WF situation was.
If they're the only game in town, make sure you never become overdrawn and don't write any checks based on a check you've deposited until it clears. Either that or keep cash on hand and only keep the minimal requirement to keep your account open at the bank itself.
Downright scary what banks are capable of doing with their customers' money.
Sure, factor it in, but no one knows what the future holds and MTSO has no control over those
:+
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