I recently incorporated my sole proprietorship due to chances of getting sued working in the legal field. I also have a couple other small side jobs, one coaching and the other working small marketing projects for my friend. I am going to start getting my checks paid to me for my legal job under my business name which means I need to open a business checking account. Should I have my other jobs write my checks out to the business even though they are in a different field of work, can I do that and will it hinder me when it comes to tax time? PS I make under $25,000 a year and I work all these little part time jobs so that I can stay at home with my son, he just turned one this month:)
Good move getting incorporated. What type of corporation? LLC or S-Corp? Also may depend on which state you reside in; some states do not recognize S corp. I would go for making all payments to the corporation rather than to yourself. I am assuming that you now get 1099 fromall your side jobs. the big difference will be that your self employment tax burden will be lower when payments are made to your crporation. Of courseyou wll need to write and employment contract so that your corporation can pay you a reasonable salary.
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If you incorporated as a Sub-Chapter S, It will probably not make much difference.
Also, your corporate veil of protection is like wearing a hospital gown and thinking you are covered!References :
Good move getting incorporated. What type of corporation? LLC or S-Corp? Also may depend on which state you reside in; some states do not recognize S corp. I would go for making all payments to the corporation rather than to yourself. I am assuming that you now get 1099 fromall your side jobs. the big difference will be that your self employment tax burden will be lower when payments are made to your crporation. Of courseyou wll need to write and employment contract so that your corporation can pay you a reasonable salary.References :