Re:From idea to replacing full-time salary in 4 months
by courtewing on Monday April 16, 2012 @09:06AM
(#3847165)
It was refreshing to see how receptive he was to that feedback, though. Based on his responses, it seems like he is going to take an active look at how he handles employment status.
It by no means signifies a guaranteed success, but it is definitely a good sign when an entrepreneur recognizes legitimate criticism about issues that could make or break his business and actively seeks to address them.
Re:From idea to replacing full-time salary in 4 months
by tptacek on Monday April 16, 2012 @09:43AM
(#3847296)
Becoming compliant isn't a paperwork task. It's going to be expensive. He hasn't been withholding any taxes; he could end up owing as much as $1000 for each prior month he failed to do that.
The city and state his business is headquartered in (he's in DC Metro so it could be any of a bunch) is also going to tear into him for unemployment taxes and fees. We had drama with this even though we don't even have independent contractors.
• he seems to be comparing his prior 'take-home' (after-tax) pay with his new venture 'profits' (monthly pre-tax).
• as another redditor points out, he may be in for a painful 1099-reclassified-as-employee showdown with the tax and employment authorities
And yet, good on him. He's found a niche and will now rapidly get to learn the tax & employment law details.