1099 Work

31 Comments

1. AnonymousJune 25,2024 at 10:14PM UTC

   In my contract I block out certain weeks for vacation and also include language that allows for a flexible schedule at my discretion with advanced notice to my point of contact at rach of the companies. This means I will be available a certain number of hours per week with flexibility for more or less hours depending on my schedule. I work well with both my clients so over the past few years this has never been an issue. I'm a professional and understand my clients' needs. It helps that I'm 100% remote.

   As for the lack of PTO benefits, since I bill at 3x my normal salary. I don't miss the benefits of accruing pto.

2. Alexis GladstoneJune 26,2024 at 12:36AM UTC

   It depends on how the contract is written, but I've always worked with the premise as a 1099 contractor I take the time I need knowing I won't be paid for those hours/days. I've always told my clients well in advance when I possible, and block my calendar accordingly so that no one tries to schedule meetings.

   Of course we all have emergencies and if you have a good relationship with the client, they will understand.

3. Jackie RukaJune 26,2024 at 1:30AM UTC

   I have been 1099 for a long term contract and I used affordable care to cover my health insurance.

   it also depends on the contract, mine was strict as far as it was enough work to cover 40 hours a week, however Vee did get PTO, holidays etc. paid in our contract .

4. Rachel DutcherJune 27,2024 at 1:23PM UTC

   You account for the benefits and PTO with the rate you are charging as a contractor. As long as your rate is high enough you’ll be able to provide yourself with similar “benefits”.

   For example I used to set aside part of my monthly freelancing income so that I could “pay” myself if I was out sick or on vacation. I think it was 5% of all income to give you an idea of how I did it. And I opened an IRA and had health insurance through my states marketplace.

   I also worked with my clients so they knew if I was taking time off that would impact them.

5. AnonymousJune 28,2024 at 12:31PM UTC

   I’m not really sure what your question is. Generally, it’s not legal to pay you as a 1099 if the employer controls the hours you work; they are only able to dictate the results of your work, not how and when you do it. So you take time off when you want or need to, you just don’t get paid (if you bill hourly).

6. AnonymousJune 28,2024 at 12:54PM UTC

   With contact work (1099) the bottom line is you don’t work - you don’t get paid. I’ve had to budget in the time.

   when you go on vacation the hours you can’t bill is an an extra expense to budget.

   same with sick days or dealing with kids doctors appointments…

   I’ve often had to work to make up the time.

7. AnonymousJune 28,2024 at 12:57PM UTC

   Seconding what was said here, I’ve worked two 1099 jobs, one with a vacation policy (which wasn’t written down so it was basically moot) and one with literally just no oversight or procedures for taking time off which meant my work life balance was off because even when I was off they would still contact me.

8. AnonymousJune 28,2024 at 12:58PM UTC

   I have performed 1099 work and did take time off which was not as big of an issue for me as the fact that you have to pay taxes when you file your tax return which is very costly in a lump sum UNLESS You save the tax amount not withdrawn on a regular basis.

9. Lorraine HerreraJune 28,2024 at 1:36PM UTC

   Please, read the IRS requirements for independent contractor. 1099 is a provision for self-employed, business. If is something you depend on full time. If they set your time, training, etc. You are an employee and they are violating the law. Check that before you have to pay the taxes.

   If you search Independent Contractor Defines IRS, it will show you

10. AyianJune 28,2024 at 1:53PM UTC

    Nothing they said indicated to me that there is a violation of contractor vs employee definitions yet. I've done audits for this in a few companies. Of course, we don't know all of the details, but so far out looks fine.

11. AyianJune 28,2024 at 2:17PM UTC

    There seem to be some comments where labor laws were violated, so please allow me to lay it all out.

    1099 contractors:

    Work on their own time in their own fashion with a specified end result. How you get to that result is up to you.

    Dictate their own availability. The client must respect whatever that availability is

    Pay their own taxes, insurances, retirement, etc

    Are not required to be in the office unless the thing they are contacted to do requires presence at a specific location in order to get, do, or interact to get the contacted work accomplished.

    Provide their own equipment (a company laptop, for example, would make you an employee, not a contractor)

    What you should consider most is your rate. Assume that 20% of whatever you bring in is gone immediately to taxes. Add together your desired annual take home pay, half the cost of your self-provided insurance and retirement, the full amount of your life insurance, and some amount extra for cost of transportation back and forth to your client's office as needed, equipment, and $500 of miscellaneous expenses. Then divide that by 80% so you get all of that plus the 20% of income that may already be "spent" before you receive it. Now take that annual amount and divide it by 50 (52 weeks in the year, minus 2 weeks to take off whenever), then divide it by how many hours you expect to reliably work every week. This is your hourly rate. If it's very far outside what you're being offered already, this is not going to work well for you and they're taking advantage and underpaying you purposefully by treating you as a contractor. Renegotiate if you can and regardless of how it works out, keep this formula in mind.

12. AnonymousJune 28,2024 at 2:39PM UTC

    Most businesses consider 34% of your salary as fringes the company has to pay for you by them - health insurance, 40!k contributions, taxes. Remember a business pays workman comp insurance, unemployment insurance and the company's portion of social security.

    So I say when negotiating, figure a 1099 wage should be a W2 salary wage plus at minimum 34% markup.

    Just saying

13. AnonymousJune 28,2024 at 2:39PM UTC

    If you're a contractor you are your own boss. You have to save your own money for time off.

    That said, I once had a long-term contracting position where I did such good work and was so respected, that they would actually let me charge for a week that I wanted to take off. But I suspect that's very rare.

14. Cynthia TrivellaJune 28,2024 at 3:20PM UTC

    I have been a 1099’er for over 10 years. As someone is self-employed, you have the option to craft your own schedule (to a point.)

    Traditionally, 1099’ers don’t get compensated for PTO, but I am hearing more and more of how people are building this into their contracts, today.

    One of the things you can do is build PTO into your agreement. You can either take the PTO as non-payment with the understanding that you will be taking X number of days off each year. The other option is to build this into your agreement with the understanding that they will compensate you for time off. I highly recommend (either way) that you get this into the agreement before you accept the job.

    Just something to note as you’re thinking this over, you will need to account for time off for potential sick and mental health days. Let them know that whatever number of days you land on, it covers all days away from your desk.

    One of the things I have bumped up against is how some people don’t understand that just because an individual works from home, it doesn’t necessarily mean that they will work while sick. Please keep this in mind.

    Good luck.

15. AnonymousJune 28,2024 at 3:34PM UTC

    I would speak to them about how time off will work with your contract, a 1099 essentially is a contractor so there should be a contract that outlines this stuff.

    When I have been 1099, and I had small children at the time so not school but definitely was a benefit to have the flexible schedule. You need to make sure your rate for work covers your needs - if you know you'll need time off and that time is not paid (such as PTO) make sure the rate you have accounts for the need to take unpaid time off.

16. maria roseJune 28,2024 at 4:46PM UTC

    That’s what is a Pro/Con benefit of being a contract worker—you control your own time that you work, so you control your financial situation. You choose this over working as a classified regular employee who gets those “benefits “ that you are now asking about. Everything is clearly written down in your employee contract for the company you are contracted to work for and you agree to those terms. It really is up to you to take your pay and put at least some of it into your for lack of a better word—“emergency fund “ for the times you are not working—remember as a contractor worker you are your own boss which does include how you divide your money earned into necessary expenses—that you have to pay—taxes, housing, utilities, time off, etc—you sound as if you are just starting out doing this and were not aware of what responsibilities you have to controlling your finances beyond your control of your own time. Perhaps someone else can explain this better in a way more detailed for you to understand. —good luck

17. AnonymousJune 28,2024 at 8:11PM UTC

    You do what you need to- cap your work week at 40 hours or whatever you commit to during the contract with your client and then unplug when you are needing to take a break.

18. AnonymousJune 30,2024 at 1:15PM UTC

    Well, I work part time as a substitute teacher. Unfortunately, most substitute teachers usually don't qualify to get PTO or benefits. Sometimes, public schools in the past would hire a long term or permanent substitute. Sometimes, these substitutes might get benefits but not necessarily teacher pay.

    I had to go through a job placement agency even though I have worked for a public school before.

    If anything, you have the flexibility of making your own schedule as a 1099 contractor substitute. But if you make over $600 you may have to pay with holding taxes.

19. Lisa MarieJune 30,2024 at 1:36PM UTC

    There is basically one correct answer for a 1099 status worker, which has been said in some of the comments in some fashion or another. Here is the summary:

    ● True 1099 status means you are not an "employee" so there is no such thing as *Paid Time Off* for a 1099 status worker.

    Rather, YOU control when you TAKE time off/work or not work - not your agency or direct client (if you are not working through an agency).

    So simply schedule (inform or block your calendar) when you will not be available to work with the full knowledge that "when you don't work, you won't get paid."

    Now here's a summary of Helpful Advice - also given in some way in other responses:

    1) Take a bit of time to figure it out, and set some $$ aside for the period(s) you do not intend to work (won't have billable hours/days to get paid ).

    **This advice is simply for you to have cushion $$ to cover any non-billable time/days**

    2) If the time period (dates) you will not work is known in advance, you should give either your agency or client advance notice of when you *will not* be available/working.

    For unforseen situations (when life happens), and you won't be able to bill for time/days you don't work, as a professional, you should still inform whomever you need to, about what's happening, then proceed to take the time/days you need to handle whatever the situation(s) that may arise.

    **This advice is simply so it is clear that you comported yourself professionally in every situation**

20. Taylor StevensonJune 30,2024 at 3:21PM UTC

    What OP is thinking of is contracted work which is usually not 1099 . 1099 work is like fiveer or making their own contracts. I wonder if there's a union for those jobs.

21. RMW324June 30,2024 at 1:54PM UTC

    I have been working as a 1099 contractor for the past 5 years. With a small child, not having set hours or a set schedule is what I consider one of the perks.

    There may be an expectation of attending internal and external client meetings, but in a true contractor arrangement, the client doesn't have control of when and how you get your work done. There is no expectation for example that you will be at your desk from 9AM - 5PM - in that case, you would be considered an employee.

    There should be clear expectations around deliverables, and any internal/external meetings you'd attend. You should communicate with the client if you will be unavailable to attend any scheduled meetings, or will be unavailable for any length of time (hours, days, weeks) in advance so that the expectations of your availability are clear. And you should independently have a plan for how you will make up any hours/complete any deliverables - whether that means working extra hours/off hours or setting your rate to account for any planned time off.

22. Adele Jones StrattonJune 30,2024 at 2:52PM UTC

    Before accepting the pay amount, make sure you've considered that, in addition to needing to provide your own benefits such as health insurance, you will also need to pay into the IRS (on the 15th of April, June 15, September and January) the amount of income tax that an actual employer would have withheld from that same pay. Plus, each year you will need to file a Schedule SE with your income tax return and that will take an extra 15.3% of your gross pay from what you've received. Those "bites" can diminish what initially looks like a great income.

23. BarbaraJune 30,2024 at 4:24PM UTC

    Excellent response. So nice to have experts on this site.

24. AnonymousJune 30,2024 at 5:40PM UTC

    I've worked 1099 and self employed LLC for the last 3.5 years. At first, it's a weird adjustment without all the benefits but over time, we've adjusted nicely...since you set your own schedule, you can take a day here and there without pay...I don't miss PTO...the only benefit I sort of miss is sick time...

25. LORI-ANN BURLINGAMEJune 30,2024 at 8:55PM UTC

    There are Pros and Cons to doing contract work. You mentioned that you will have a flexible work schedule and that the compensation is good. However, there are some downsides to doing contract work. You have PTO, but it is not paid PTO. Can you adjust your household expenses to compensation for unpaid PTO? It sounds like the Pros outweigh the Cons in this case.

26. Shonda PattersonJune 30,2024 at 9:44PM UTC

    I just started a 1099 job. Where did you find insurance

27. Stella FeinbergJuly 1,2024 at 12:35PM UTC

    Call your regular insurance broker and ask if they carry general liability or whatever it is you do to cover yourself unless it’s health insurance

28. Elizabyth HarringtonJuly 1,2024 at 1:28PM UTC

    I’m also in the same boat with no PTO. What I did (before I accepted the job) was to calculate what an acceptable salary (with PTO) and then negotiate my rate to fall within that range. I take a hit on holidays, but at the same time, if I know in advance I’ll need the PTO, I try and pick up extra hours in advance so the hit to my paycheck isn’t as bad.

29. ErinJuly 1,2024 at 4:39PM UTC

    Hey, Anonymous. Great questions. I've enjoyed working as a 1099 or B2B contract on and off for a number of years with my consulting business. Here are some things I've learned along the way:

    1. As a 1099 or on a B2B contract, you are a small business owner. You need to get some good people to help you ensure that you do it well (at minimum, I highly recommend a good accountant and an attorney-- both need experience working with self-employed, small business people regularly). Having a mentor in your industry helps too.

    2. Your professional organization may have a deal to help you get decent insurance and related benefits (e.g., American society of journalists, Mystery Writers of America, National Association for the Self-Employed, etc.). If not, Dave Ramsey's team are all about cost effective strategies. (You can Google them easily.)

    3. If you want to stay a 1099 for the long-term, you should talk to an estate planning attorney about how to meet your retirement goals with this new plan. Talk to someone who isn't paid on commission AND is a fiduciary (this means that they have a legal responsibility to act in YOUR best interest; not theirs, not their company's--yours.) Go ahead and ask them straight out if they're a fiduciary-- you're unlikely to be first to ask. If they don't knew what you're talking about, they aren't the person you need.

    4. Ask your attorney and accountant (preferably in the same conference call, so everyone is on the same page), what entity you should incorporate as (e.g., LLC, LLP, S-Corp, etc.). Ask about:

    A. professional liability (what happens if you do something or miss something and a client sues you) and

    B. Tax liability (when do you pay taxes, how do you pay taxes, can the accountant send the check in for you, can the accountant do the payroll for you & your assistant, should you set up a separate account for tax money, would it benefit you to be taxed as an S-Corp if your an LLC, etc.).

    5. As soon as you're able, get an assistant. Even if it's a part-time assistant, they can take administrative tasks off your plate, so you can focus on the things that make you money.

    6. Entrepreneurs (AKA business owners) don't get paid time off from their customers/clients. As a 1099 small business owner, you're an entrepreneur. However, you can set up things so that your business continues to pay you/your bills when you take time off. One way is for your business to set up a bank account that is set aside to pay you when you need PTO. Talk to your accountant and attorney about how to set something like that up, and if it could be in a tax deferred account.

    I've loved working for myself and with my clients. The freedom is addictive.

    Best of luck!

30. AnonymousJuly 1,2024 at 5:27PM UTC

    Some nuance that might not be mentioned is that YOU ARE YOUR OWN ADVOCATE. This said, PTO can be construed in several ways, for example flex time or flex holidays can be considered PTO, it's just important to include it in your arrangement. If it's not spelled out specifically in your contract, you can include it. Thoroughly read the contract and understand that if there's no mention of specific things like PTO, holidays or travel policy, you need to list it out as an addendum to the agreement. You mention long term, so I presume your contract might be ongoing for several years, so it's more crucial than you realize. We all get sick, we all need personal time off and this company should recognize that as well, so there's room for it to some capacity, you just have to explore that through the language used within the contract and if you don't find it, ADD IT yourself and through the art of negotiation there may be some compromise but you must be conscious that if it's not mentioned, its not going to be considered as part of your arrangement once the ink is dry.

    BE PARANOID, BE SPECIFIC, but be professional!

    A company offering 1099 work knows what they're doing and if you don't, they can take advantage of you.

    This includes:

    -Holidays (for example, if you work for a company outside the U.S. you should list the holidays you will not be in your office. I use either "U.S. bank observed or U.S. National holidays -typically 10 per year)

    -How you bill your work: Do you need to bill them monthly? Do you need to provide an invoice? Will you be paid monthly, or biweekly?

    -Travel policy (what will/won't they reimburse you for? Also important, when will they reimburse you? Will you need to put up your own money to book a conference, flights and accommodations, etc. and bill them back?

    -Mileage/Gas: Will you be reimbursed for this when you represent them?

    -Work attire: You might need a polo with logo for example, will they provide that or will they deduct that from your fee (this actually happened to me and I had to pay for a polo).

    -Stipend for remote work. Some companies will pay a monthly stipend for you to use your own cell phone or internet to get the work done.

    Everything is negotiable, so show no fear. There's no harm in exploring the unclear aspects of the job itself; if anything it shows maturity and concern.

    Just make sure you document everything. You are billing your work, so if you took time off, ensure you can account for the time and how you made up for it but definitely work in some flex or personal holiday time to make up for the lack of PTO language.

31. Jill Basye-FeatherstonJuly 6,2024 at 3:59PM UTC

    Set up your own day off or hours off a day. Set up a vacation time. Consider working half days on trips. Make it part of your plan. I had a boss who wouldn't approve vacation leave requests on the off chance that we would have a report due to the state government. I'm still trying to figure out how much I need to make to pay myself to be totally off during weekdays.