Tax Filing Questions

[Eretria90]

I'm apparently working as a 1099 Contractor, but I don't know specifically what that entails. I know that means that because I'm not a W-2 Employee, taxes are not withheld from my paycheck every month (as of now I'm paid monthly).

But my issue is I don't know how much I will ultimately owe the government in these taxes...people are telling me to take at least 25% out of my paycheck and deposit that into a separate account to accrue interest.

I've read that I will need to pay my taxes quarterly instead of at the end of the year (I'm assuming "end of the year" is April 15?), but I'm not understanding? This means I'll need to fill out a form every 3 months? What form would I be filling out?

Specifically, what taxes will I need to owe the government (Medicare? Social security?) and what will I need to owe the state?

This is my first time being a 1099 Contractor (I started in Jan. 2014); before this I was always a W-2 Employee. Really, this whole 1099 Contractor thing is a complete scam. I can't believe that this sort of business is legal. My employer is not legally obligated to sign me up as a W-2 Employee (I didn't know this until I asked) but this makes everything harder for me now.

Should I go to an Accountant and have him/her walk me through this and just do my taxes for me? My issue with getting my taxes done by somebody else is that it will cost hundreds of dollars. But I really don't have the knowledge to do this myself (a family member usually helps me do my taxes every year) and I don't think anyone in my family has experience doing taxes for a 1099 Contractor. I'm also worried that the CPA will make a mistake on my taxes, as this happened to my sister when she went to get her taxes done.

I'm so confused and this is causing so much stress for me.

 

[Paul01]

I would check out Turbotax. You can do your taxes free, and you don't pay them anything until you actually file...so if you get halfway through it and you're confused, just stop and maybe hire someone. I'm no expert on taxes and I have a pretty complex situation - and I've never had any major problems using their software.

As far as paying quarterly, that is probably regarding paying estimated taxes in advance to avoid a future penalty. You don't have to fill out forms every payment, it's just a voucher you send with a check prior to the end of each quarter, at least that's how it works for me.

 

[DaisyDay]

I'm apparently working as a 1099 Contractor, but I don't know specifically what that entails. I know that means that because I'm not a W-2 Employee, taxes are not withheld from my paycheck every month (as of now I'm paid monthly).

But my issue is I don't know how much I will ultimately owe the government in these taxes...people are telling me to take at least 25% out of my paycheck and deposit that into a separate account to accrue interest.

I've read that I will need to pay my taxes quarterly instead of at the end of the year (I'm assuming "end of the year" is April 15?), but I'm not understanding? This means I'll need to fill out a form every 3 months? What form would I be filling out?

Specifically, what taxes will I need to owe the government (Medicare? Social security?) and what will I need to owe the state?

This is my first time being a 1099 Contractor (I started in Jan. 2014); before this I was always a W-2 Employee. Really, this whole 1099 Contractor thing is a complete scam. I can't believe that this sort of business is legal. My employer is not legally obligated to sign me up as a W-2 Employee (I didn't know this until I asked) but this makes everything harder for me now.

Should I go to an Accountant and have him/her walk me through this and just do my taxes for me? My issue with getting my taxes done by somebody else is that it will cost hundreds of dollars. But I really don't have the knowledge to do this myself (a family member usually helps me do my taxes every year) and I don't think anyone in my family has experience doing taxes for a 1099 Contractor. I'm also worried that the CPA will make a mistake on my taxes, as this happened to my sister when she went to get her taxes done.

I'm so confused and this is causing so much stress for me.

You should get a decent accountant, especially for your first year. Don't go to a chain outfit, get a real, 12 month a year one. As a 1099 person, you could wind up paying a lot more than you should if you don't know what all deductions you can make. It should cost you a couple hundred dollars (if your return is not complex, if you're not incorporated and have average investments), but you should recoup that in tax savings.

 

[ayaanu86]

Filling tax has walways been confusing , I have always assigned this work to my Accountant