1099 vs. W2 under Republican tax law

[gfresh]

First time poster, long time reader

2018 EM residency grad, trying to decide between a job as a hospital employee w/ full benefits vs. 1099 with a large contracting group w/ only malpractice covered. For context, my wife and I are in our early 30s, we have a toddler who requires speech therapy for a language delay, and a new baby, so buying my own health insurance with the 1099 sounds intimidating.

[political commentary removed -- nachos31]

I understand there was some debate about the tax law benefiting pass-through business owners, but that it wouldn't affect service-minded folks like lawyers, accountants, etc. I also understand we won't know much until the bills are reconciled...

 

 

 

[ENT Doc]

gfresh wrote:

First time poster, long time reader

2018 EM residency grad, trying to decide between a job as a hospital employee w/ full benefits vs. 1099 with a large contracting group w/ only malpractice covered. For context, my wife and I are in our early 30s, we have a toddler who requires speech therapy for a language delay, and a new baby, so buying my own health insurance with the 1099 sounds intimidating.

Wondering how the new tax reform that is fleecing the middle class would affect both of these prospects.

I understand there was some debate about the tax law benefiting pass-through business owners, but that it wouldn’t affect service-minded folks like lawyers, accountants, etc. I also understand we won’t know much until the bills are reconciled…

 

 

 

Click to expand...

Can't provide any advice because we don't have any details on:

W2 salary

Contracting salary

Health insurance costs as a contractor

Wife's income

Who covers malpractice costs

Etc.

 

Also, we don't know the details of the final law.  And lastly, I would refrain from inaccurate political commentary.

[jfoxcpacfp]

For some folks, it really makes sense to go the 1099 route. As  ENT Doc stated, we have far too little information about your situation. For such a big decision, I'd recommend working with a CPA. You're going to need one for your tax prep, anyway - at least imho. One thing you should consider that is not listed above is how much you can put into your 401k at work. With the 1099, you'll be able to max out your solo-k at $55k in 2018 and may be able to get far less into it as an employee.

What is your timeline? If you can push your decision off until the tax bill is finalized, I think you should.