Working For Yourself: Law & Taxes for Independent Contractors, Freelancers & Consultants

Table of Contents......Page 10
Introduction......Page 16
1. Working for Yourself: The Good, the Bad, and the Ugly......Page 18
A. Working for Yourself: The Good......Page 19
B. Working for Yourself: The Bad......Page 21
C. Working for Yourself: The Ugly......Page 22
D. How to Use This Book......Page 23
2. Choosing the Legal Form for Your Business......Page 24
A. Sole Proprietorships......Page 27
B. Corporations......Page 30
C. Partnerships......Page 45
D. Limited Liability Companies (LLCs)......Page 46
3. Choosing and Protecting Your Business Name......Page 52
B. Choosing a Trade Name......Page 53
C. Choosing a Trademark......Page 57
D. Choosing an Internet Domain Name......Page 60
E. Conducting a Name Search......Page 61
4. Home Alone or Outside Office?......Page 64
A. Pros and Cons of Working at Home......Page 65
C. Leasing a Workplace......Page 68
D. Restrictions on Home-Based Businesses......Page 70
E. Deducting Your Home Office Expenses......Page 75
5. Obtaining Licenses, Permits, and Identification Numbers......Page 84
A. Business Licenses......Page 85
B. Obtaining an Employer Identification Number (EIN)......Page 86
C. Sales Tax Permits......Page 87
6. Insuring Your Business and Yourself......Page 90
A. Health Insurance......Page 92
B. Disability Insurance......Page 103
C. Business Property Insurance......Page 104
D. Liability Insurance......Page 106
F. Workers’ Compensation Insurance......Page 108
H. Ways to Find and Save on Insurance......Page 111
7. Pricing Your Services and Getting Paid......Page 114
A. Pricing Your Services......Page 115
B. Getting Paid......Page 122
8. Taxes and the Self-Employed......Page 138
A. Tax Basics for the Self-Employed......Page 139
B. Handling Your Taxes......Page 142
C. IRS Audits......Page 147
9. Reducing Your Income Taxes......Page 152
A. Income Reporting......Page 154
B. Introduction to Income Tax Deductions......Page 156
D. The Cost of Business Assets......Page 163
E. Car Expenses......Page 172
F. Travel Expenses......Page 175
G. Entertainment and Meal Expenses......Page 178
I. Start-Up Costs......Page 180
10. The Bane of Self-Employment Taxes......Page 182
B. Self-Employment (SE) Tax Rates......Page 183
D. Computing the SE Tax......Page 184
F. Outside Employment......Page 185
11. Paying Estimated Tax......Page 188
A. Who Must Pay......Page 189
B. How Much You Must Pay......Page 190
C. When to Pay Estimated Tax......Page 193
D. How to Pay......Page 194
E. Paying the Wrong Amount......Page 195
12. Rules for Salespeople, Drivers, and Clothing Producers......Page 198
A. Statutory Employees......Page 199
B. Statutory Independent Contractors......Page 203
13. Taxes for Workers You Hire......Page 204
A. Hiring People to Help You......Page 205
B. Tax Concerns When Hiring Employees......Page 206
C. Tax Reporting for Independent Contractors (ICs)......Page 213
14. Record Keeping and Accounting Made Easy......Page 220
A. Simple Bookkeeping......Page 221
C. If You Don’t Have Proper Tax Records......Page 231
D. Accounting Methods and Tax Years......Page 232
15. Safeguarding Your Self-Employed Status......Page 234
B. If the Government Reclassifies You......Page 235
C. Determining Worker Status......Page 237
D. IRS Approach to Worker Status......Page 238
E. Preserving Your Status......Page 243
16. Retirement Options for the Self-Employed......Page 248
A. Reasons to Have a Retirement Plan(s)......Page 249
B. Individual IRAs......Page 251
C. Employer IRAs......Page 253
D. Keogh Plans......Page 254
E. Solo 401(k) Plans......Page 255
F. If You Have Employees......Page 256
17. Copyrights, Patents, and Trade Secrets......Page 258
A. Intellectual Property......Page 259
B. Copyright Ownership......Page 262
D. Trade Secret Ownership......Page 268
E. Using Nondisclosure Agreements......Page 269
18. Using Written Client Agreements......Page 276
A. Reasons to Use Written Agreements......Page 277
B. Reviewing a Client’s Agreement......Page 279
C. Creating Your Own Client Agreements......Page 280
D. Putting Your Agreement Together......Page 282
E. Changing the Agreement After It’s Signed......Page 284
19. Drafting Your Own Client Agreement......Page 286
A. Essential Provisions......Page 287
B. Optional Provisions......Page 297
C. Sample Client Agreement......Page 304
D. Using Letter Agreements......Page 308
20. Reviewing a Client’s Agreement......Page 314
B. Reviewing the Contract......Page 316
C. Provisions to Avoid......Page 317
D. Provisions You May Wish to Add......Page 321
E. Client Purchase Orders......Page 322
21. Help Beyond This Book......Page 324
A. Help Resolving Disputes......Page 325
B. Finding and Using a Lawyer......Page 328
C. Help From Other Experts......Page 330
D. Doing Your Own Legal Research......Page 331
E. Online Resources......Page 333
Appendix 1: Forms and Documents......Page 336
Asset Log......Page 338
Expense Journal......Page 340
Income Journal......Page 344
Invoice Form......Page 346
Appendix 2: Sample Agreements......Page 348
General Independent Contractor Agreement......Page 350
Contract Amendment Form......Page 356
Nondisclosure Agreement......Page 358
Appendix 3: Agencies......Page 362
State Offices Providing Small Business Help......Page 364
State Unemployment Tax Agencies......Page 368
State Sales Tax Agencies......Page 370
Patent and Trademark Depository Libraries......Page 374
State Trademark Agencies and Statutes......Page 376
Index......Page 380
Related Products......Page 398