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Best route for a financial adviser to help incorporate and taxes (contractor)

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  • xilex
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    I would inquire of the recommended list of advisors as to who could get you started and do so for an hourly rate (with an estimate) or set cost for the scope of the project. It might be useful to have an ongoing relationship with one as a CPA, but that is your choice.
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    Thanks to both for replies. About this one...I may be confused regarding the difference between CPA and financial adviser. Can you clarify the purpose of each? Many of the financial adviser description talks about asset management, real-estate planning, etc, which I do not need.

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  • ajm184
    replied
    Hopefully there is an attorney who can answer #1 better (especially for CA.), but my experience is that a 1099 is from a company to a person and the income (and associated business expenses) pass through to an individual 1040, specifically schedule C.  You do need tax ID number as I recall to pay all those taxes below, hence you need someone (i.e. lawyer) for registration/incorporation.

    As for taxes, yes you file and make estimated quarterly federal income taxes, in April, July, October, and January (of following year) to the US Treasury (EFTPS.Gov).  In addition, you make payroll tax payments (FICA, Medicare).  It is easy to do yourself if you wish, a simple excel spreadsheet will suffice. Alternatively CPA's are able to do the tax payment stuff, though they can charge a couple hundred monthly; depends on your time/effort versus money, but if you are here......   In my experience, the state had their own electronic payment system for state level income taxes and annual unemployment taxes; again you can do yourself with a bit of research/IT savy.

    Vanguard will help you get the paperwork together for a 401K if that is the direction you choose.  I would highly consider a ROTH 401K versus a solo 401K. Funding/sending money to your retirement account is very easy after setup.

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  • VagabondMD
    Radiologist (retired)

  • VagabondMD
    replied
    I would inquire of the recommended list of advisors as to who could get you started and do so for an hourly rate (with an estimate) or set cost for the scope of the project. It might be useful to have an ongoing relationship with one as a CPA, but that is your choice.

    Leave a comment:


  • Best route for a financial adviser to help incorporate and taxes (contractor)

    Hi all, I'm going to start a 1099 contractor job position (around Los Angeles/Orange County region). I will have to preface a few things before I get into what I'm looking for.

    My plan is going to do an S-corp. I believe to do that, I would require the services of a lawyer who specializes in that. In addition to an S-corp, taxes will have to be filed differently. I am up for doing it myself, but I need to learn how and to make sure I'm doing it right. This initial learning phase is where I feel I would like to have some direct help. From what I understand, you will file quarterly and then you also have to make it look like you're a corporation. Then there is tax optimization with an S-corp, which I think guidance from an adviser would be helpful.

    Regarding investments, I can manage that myself (allocations, etc). The intent is to set up a solo401k with either Fidelity or Vanguard. The only unknown I have is how to do the employer contribution into the 401k, given that I will be an S-corp.

    I was referred to this local group in California but they want to charge $300 a month as a retainer fee, which I feel is expensive. I saw the blog post containing the list of financial advisers. Is that something I should do, or should I look for something locally?

    Basically, I need a) help with forming S-corp, b) learn how to fill the tax forms correctly, c) learn how to fund the 401k correctly (18k employee, 35k employer). Thank you.
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