Your instinct is probably right – it is easier for them, but
not necessarily for you.
The biggest change will be that as an independent
contractor, no taxes will be withheld from your income – no Federal income tax,
no Social Security tax, no Medicare tax, no state tax. You will be responsible for setting money
aside and possibly making estimated payments to cover all of those taxes. It is
not necessarily a difficult thing to do, but you need to plan ahead so that you
won’t be surprised at tax time.
Filing your taxes will be a bit more complicated than just
reporting income from a W-2. You will be
filing a Schedule C to report your income and expenses. TurboTax can walk you through it all a step
at a time though.
TurboTax has many articles and tips to consider for
self-employed persons. Take a look at a
few of those to learn more before you make your final decision or try to
negotiate further with your employer.
Here is a good one to get you started (links to other
articles will be at the bottom of the page):
Beginner’s
Tax Guide for the Self-Employed
