Article Directory :: Finance & Investment Articles

Confusing 1099-K Instructions and Other Self-Employed Problems

By John V

Republish: EasyPublish™ Published: 28Feb2012 Word count: 533 Viewed: 140 time(s) Get Free Content For Your Site

The joy of joining the ranks of the self-employed lasts a long time, but it quickly loses some of its luster in the face of the self employed tax, potentially dealing with 1099-K instructions, unexpected frustrations that come with being one's own boss, and the cost of health insurance. There are countless guides out there to help people adjust to this change and use the benefits of self employment to excel professionally and personally. But even before those detailed and advanced strategies, it's a good idea to plan based on what common problems and frustrations a person can expect.

It can be difficult to typify what a self-employed person will face because there are so many different ways to do this: freelancing for one company, creating some form of art to sell in a gallery with an agent, making a physical product to sell online or developing a skill to provide a specific intangible service, starting a more traditional-looking company with a partner, or running a one-person business that supplies some specialty consulting or inputs as part of a supply and development chain are just a few common examples. However, all of these people face a few similar and unifying difficulties.

The first is, obviously, taxes. Not working for another company but still generating an income leads to a somewhat radical shift in how taxes are evaluated and paid. This seems obvious but when an employer issues a paycheck, Social Security, Medicare, and Federal income tax are deducted from the check based on an increment of estimated yearly earnings, as are the costs of health insurance and any other retirement or investment plans supported by the employer. The employer also covers some of the insurance costs as well as Federal employment tax costs in many cases. Being self employed, a person is his or her own employer and so has to cover all of this extra tax cost, which can be a huge shock at first.

Another is dealing with processing payment and delivery of goods or services. Even if a person hires someone to deal with taxes, keep the books, monitor inventory and delivery, keep track of the schedule, or do any of the other tasks necessary, the act of finding that person is a big change. The difference between this and being an employee, where you tend to have a few discreet tasks that contribute to the organization's overall function, is even stronger if the self employed has to keep track a sales volume, 1099-K instructions to file tax forms appropriately, and continue to do the actual work that results in something saleable. Figuring out how to do all these things, manage the time necessary to meet every goal, and maintain some semblance of a life is a common and difficult problem that requires experience to overcome.

Perhaps unsurprisingly, money and time define these two main problems that give newly self-employed people a hard time. The best thing to do is think about what form they could take, collect all the necessary materials possible, like 1099-K instructions for online retailers, ahead of time, and then accept these hiccups as natural when they arise.

EasyPublish™ this article - publishers click here

More articles by John V

Free Report!
Ten Essential Secrets Of Article Marketing ... Grab Your Free
Copy Now:

Need Content?
Regular Top Quality Content for your Blog, Ezine or Website ...
Delivered Direct,
For Free!
Click For Details