Quote: (02-12-2014 02:55 PM)deuce Wrote:
I've been working as an independent contractor since early 2011. I've already realized the myriad of everyday purchases that can be legitimately written off when working as an IC, but I would like to hear some tax avoidance (not evasion) strategies people are willing to share.
I have set up an S corporation and pay myself as a W-2 employee through the corporation. I am sure to pay myself "reasonable compensation" pursuant to IRS guidelines.
Is the W-2 status hurting me, even though my compensation, while reasonable for my career field, is quite a bit less than my total revenue? Or am I on the right track using the S corporation to avoid the taxation associated with filing as a 1099?
Please be sure to think about what you post in the clear. Thanks!
The S Corp is a flow through entity, I don't really understand what you are trying to do (Besides limit liability? I think S-Corps can't do this...).
You either make it schedule C and write off everything (and pay self employment, but some of it you can take as a FOR AGI expense anyway) or create a flow through entity to pay yourself.
I'm a tax accounting but I do taxes for hedge funds (used to do it for super rich people but it's a career limiting field.)