I work part time for a school as an after school teacher. They told us yesterday that we have to fill out 1099 forms and that the only difference is we'll get to keep our money and pay taxes later. How does this affect me?
You are either an employee and get a paycheck or an independent contractor and get paid in full without witholdings for the work you do. You don't switch between the work you do, willy nilly.
When you have your taxes prepared, you need to ask your tax preparer to calculate your 2019 estimated taxes and prepare vouchers. As a 1099 employee, you will be required to pay quarterly estimated taxes, beginning April 15. You will have to be careful to set aside enough money to pay your taxes, as many self-employed persons fail to do this and then they end up owing a lot of tax that they have no money to pay. Being a 1099 employee requires savings and discipline. Good luck!
Ms. Willi is a tax attorney, CPA, and Ohio-Certified Specialist in Estate Planning, Trust & Probate Law, with offices in Westerville, Ohio. She serves client families and private business owners throughout Ohio. Ms. Willi responds to Avvo questions as a public service to help educate and provide general guidance to questioners, but her responses are not legal advice and do not create an attorney-client relationship. Her posts are provided for informational purposes only and are not a substitute for advice provided by an attorney or licensed tax professional. Her phone number is 614-890-0500 and her website is www.willilaw.com.
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