Presentation on theme: "Presented by: Cullen G. Williams, CPA Brian M. Carle, CPA Jeff P. Russell, Esq."— Presentation transcript:
Presented by: Cullen G. Williams, CPA Brian M. Carle, CPA Jeff P. Russell, Esq.
EMPLOYEE VS INDEPENDENT CONTRACTOR Receive wages reported on a W-2 Responsible for ½ FICA taxes (7.65%) Taxes withheld from paycheck Responsible to employer Uses employer’s tools & resources Receive payments reported on a 1099-MISC Responsible for 100% of FICA taxes (15.3%) No taxes withheld Responsible to self Uses own tools & resources
1099-MISC received does not always mean you have a business Profit motive Level of personal enjoyment Examples Mary Kay Making furniture Drag racing
Sole Proprietorship Limited Liability Company (LLC) S Corporation C Corporation Partnership
ORDINARY & NECESSARY ALLOCATION OF PERSONAL USE Examples could include, but are not limited to: Cost of product sold Insurances specific to the business Legal fees for establishing business Accounting fees for bookkeeping, planning, and tax preparation Certain office supplies Certain travel Examples of personal use items typically include, but are not limited to: Automobiles Cell phones Computer & internet Meals
Cullen G. Williams, CPA Williams & Associates, P.A. 11 Debeck Drive Holden, ME 04429 ph 207-941-9810 EXT 17 f 207-941-9432 CWilliams@waacpas.com www.waacpas.com Brian M. Carle, CPA Williams & Associates, P.A. 11 Debeck Drive Holden, ME 04429 ph 207-941-9810 EXT 16 f 207-941-9432 BCarle@waacpas.com www.waacpas.com Jeff P. Russell, Esq Russell Law, PLLC 16 Sunset Avenue Hampden, ME 04444 ph 207-735-6361 Jeff@Jeffrusselljd.com