Confused about Tax planning

RGill · #1 Sep 5, 2008, 04:09 PM

Hi

I am a project manager (Cdn Citizen) working in California, US on TN work visa. The company which sponsored my work visa is my sister's company so its upto me to take my earnings on a W2 or 1099 and use some expense/deductions applicable for corps(?). My annual income will be around $145k and I have 2 dependents.

I am trying to figure out which route to take to minimize my taxes. I have been suggested to take a part of my income on W2 so I save on self employment tax and rest on 1099. I am really confused. If my monthly income is 12k , how much do I take on W2 and how much on 1099 on a month?

Also very important -some of my friends have taken a part of their income as "Per-Diem" which I believe is tax free for 1 year. I am told that details records of expenses need to be maintained to avail this option.Again how much per diem will I be entitled to if at all.

What other investments (college fund) etc can I do to save some tax and use it for the future. I might apply for labour certification through my sister';s company in the future.

help!!

Camborio · Sep 5, 2008, 05:30 PM

I think the best advice is talk to an experienced accountant. Then after that talk to a financial planner. I believe you can put $5,000 a year into a IRA of pretax money, and then there is the 401K, and the college plans etc...I would definately find an accountant in your situation. They will know the deductions you can take and would qualify for, and a financial planner would help that money grow and would also know about investments that you don't need to pay taxes on etc...