Becoming a 1099 contractor?

[ua_guy]

Long story short, my employer may be offering this option to help me (and them) solve some challenges around remote working so that I can continue to work remotely through the pandemic and potentially after as well. In my line of work, being a contractor isn't terribly uncommon as the work lends itself to specific projects/deliverables and initiatives.

But this would be my first go-round with being a 1099 contractor and I know there are "things to know" and I've done some reading already. Does anyone have any good tips or advice, or things that are a MUST read? TIA

[kork13]

Make sure your pay will increase... Likely dramatically. As a 1099 contractor, you're responsible for both halves of FICA, healthcare, retirement, other insurances, and literally all of the other benefits that currently come with your job. You also are taking on a higher degree of personal risk -- easier to fire you, and business liability could be on you personally vs. the company.

Switching an employee from payroll to 1099 is generally a cost-saving measure for the company for all of those reasons, likely more.

[Snicks]

If you are going 1099 you need to bump up your rate to cover the costs as noted in the previous post. Think of all the things you get when an employee, health care and all the other things. You need to almost double or at least be making about 30-40% more just to break even. Also, you need to be clear with your contract. Are they paying your hourly or by the day? Can then just cancel you on short notice without any penalty to do so? I don't want to tell you what to do but I have done 1099 and I was paid by the day, so if they needed me the whole day or a few hours, I got paid the full amount. Also, if there was a short notice cancellation there was a partial payment. You want to disincentivize them from being able to use you at a cut rate cost. A lot of people who go 1099 do not bump up their rate high enough so it doesn't work out well for them. However, there is a balance there between pricing yourself too high and too low. You would need to do some research on what is a reasonable 1099 rate for your profession and area.