I have been sent a contracting job description that gives a salary quote at W-2 status. Can you tell me what that is? I believe that I would have to pay taxes, insurance, etc. but not sure. Thanks!

ScottGem

W2s are issued to slaraied employees where taxes are withheld. Independent contractors are given 1099s for the full amount contracted and have to pay their taxes themselves.

So I'm not sure what they are doing there. You might want to ask them.

dflak

There are two types of contracting jobs: 1099's and W-2.

W-2 contracting is just like being an employee except you usually don't get the benefits. As a W-2 contractor, the employer will take your taxes out of your paycheck and pay them for you just as they do with regular employees. They also pay the employer's share of FICA and Medicare. Also, if the employer refuses to pay you as a W-2 contractor, then you can take the issue up with the department of labor.

As a 1099 contractor you are responsible for taking out your own taxes and paying them usually quarterly. You also have to pay the full FICA and Medicare. It is very much a B to B relationship. If the employer doesn't pay you, then you do not have rights under the department of labor, and will have to settle the matter differently.

However, 1099 contracting has benefits: you are a business, and you can deduct business expenses which W-2 contractors cannot. It is easier to justify a home office, and deduct expenses such as travel to and from your place of employment (your home) to the site (work). The rules on this are constantly changing, so don't take this as gospel and check with your tax advisor.