How to be a C2C or 1099 contractor?

amigan_99
amigan_99 used Ask the Experts™
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I've been offered a "C2C" or 1099 contract position. The company is interesting to me for the cool stuff they do and I want to be a part of it to see how the magic's done. They say it could go full time if things pan out - although that's not critical for me if it just winds down or turns into a long term gig. I've always either worked directly for a company or as a W2 contractor where the consulting company just took care of everything. Is there a web site that can help me dot all the I's and cross all the T's in order to be a C2C or 1099 contractor? It's all going down quickly so any advice is appreciated!
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atlas_shudderedSr. Network Engineer
Commented:
Read this:

https://www.legalzoom.com/articles/starting-up-which-state-to-file-your-llc-in

Then form your LLC.

Then read and understand this:

https://www.upcounsel.com/corp-to-corp

And you can most likely find most anything else you could imagine here:

https://www.oncontracting.com/blog.html

enjoy
Commented:
Disclaimer: *I am not a lawyer*, but I have been doing 1099 work for over 12 years as a sole proprietor.

Assuming you are a US citizen looking to work for a person or company in the US, working as a 1099 contractor can be very simple.

Depending on your situation and concerns, you do not necessarily need to incorporate--you can operate as a sole proprietor.  You simply file the simple and inexpensive DBA paperwork in your state / county / municipality, get a business license in your city, and use your SSN on the W-9 you submit to the company hiring you.  With the DBA and business license, you can then open a business bank account, setup a merchant credit card account, etc. if you wish.  If you are concerned about identity theft or protecting your SSN, you can request an EIN from the IRS as a sole proprietor and use the EIN on your W-9 instead.  Having been through a few data breaches, I recommend getting an EIN.

A lawyer might advise you to incorporate, or you may have concerns around legal liability or asset protection that may make it worthwhile for your particular situation. But make sure to consider the cost, paperwork, administration, and additional ongoing expenses (corporate fees, corporate tax preparation, etc.) that will be required for your corporation, and whether you can properly maintain the corp papers and procedure to ensure the liability protection.

If you are advised to form a corporation, make sure to learn about "piercing the corporate veil".  Just because you form an LLC (or an S Corp) does not guarantee that you have avoided personal liability.

Sample article:

https://www.nolo.com/legal-encyclopedia/personal-liability-piercing-corporate-veil-33006.html


If you are the one and only owner and employee of your LLC, you should get legal advice about how robust an LLC will be for you, and whether it will actually provide you with any real liability protection.


Lastly, regardless of which structure you choose, I would strongly recommend professional liability / E&O insurance.  Some companies will require proof of insurance from their contractors.  It's fairly common and sold by most business insurance brokers.
Philip ElderTechnical Architect - HA/Compute/Storage

Commented:
As I recall it's just one form. Fill it out, toss it to HR, and wait for any feedback.

As far as whether to incorporate, LLC, or stay self-employed talk to a good accountant. Ask any SMB that's happy with their accountant for their contact info. They will give you the best advice on how to set things up to your advantage. Uncle Sam can get their chunk ... but ... the accountant can help to keep it where it belongs. ;)

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