Howdy, folks!
I am considering leaving my current position in a private group as a W-2 employee to join another practice. Considering the new practice is appreciably smaller and doesn't offer a 401k, I have been contemplating joining it as a 1099 rather than as an W-2 until I become a partner. My thinking is that by coming in as a 1099 (i.e. being paid a negotiated percentage of collections instead of a base salary guarantee), I would be able to sock away a lot more in a solo 401k than nothing at all as a W-2 since there's no employer-sponsored 401k offered. Even though I would be paying my own benefits, I feel this option would still be worth it.
Now, I am aware that the IRS has rules as to who is really an independent contractor vs an employee. But, if I were to pay all of my own expenses, not take a base salary, etc. would this still be kosher enough to satisfy the IRS that I really am an independent contractor?
Any thoughts?
I am considering leaving my current position in a private group as a W-2 employee to join another practice. Considering the new practice is appreciably smaller and doesn't offer a 401k, I have been contemplating joining it as a 1099 rather than as an W-2 until I become a partner. My thinking is that by coming in as a 1099 (i.e. being paid a negotiated percentage of collections instead of a base salary guarantee), I would be able to sock away a lot more in a solo 401k than nothing at all as a W-2 since there's no employer-sponsored 401k offered. Even though I would be paying my own benefits, I feel this option would still be worth it.
Now, I am aware that the IRS has rules as to who is really an independent contractor vs an employee. But, if I were to pay all of my own expenses, not take a base salary, etc. would this still be kosher enough to satisfy the IRS that I really am an independent contractor?
Any thoughts?
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