S-corp

[Yellow mellow]

I have been doing IC for two months now but will soon be a W-2 employee. My question is if I decide to do 1-2 day a week as an IC, is it worth it to incorporate ? I know little to nothing about the financial side of business but it's frightening how much is taken off my paycheck so I want to get smart about money, especially since my loans are pretty significant.
I'm in transition now but once settled, I will look for an accountant.

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[Shikima]

Best to discuss this with your accountant.

 

[sweetlenovo88]

you will pay less FICA taxes, get more business deductions, and be able to save more for retirement if you incorporate as an S-corp. You have to decide if you are motivated enough to read and learn about taxation.

 

[psych md jd]

you will pay less FICA taxes, get more business deductions, and be able to save more for retirement if you incorporate as an S-corp. You have to decide if you are motivated enough to read and learn about taxation.

And, you get to file federal [maybe state] tax returns for your corporation, may have to file a dba with your medical board, may have to get insurance for your corporation, may have to get a business license...

I have to do all of that, but then again, I have 4 offices and 30 employees.

 

[sweetlenovo88]

And, you get to file federal [maybe state] tax returns for your corporation, may have to file a dba with your medical board, may have to get insurance for your corporation, may have to get a business license...

I have to do all of that, but then again, I have 4 offices and 30 employees.

If you are a one man team it is not as foreboding as it sounds. There are no state income taxes here and no need to file a dba with the medical board. Incorporation cost me $75 online and it is free to get an EIN with the IRS. For the S-corp, you don't worry about federal since it is pass down taxation, for FICA: I file a yearly 944 per IRS request but will likely being doing quarterly taxes in 2016. Also once a year federal unemployment tax, and quarterly unemployment tax with the state. I then prepare a yearly 1120S return (corporate return) and distribute K-1 earnings then. My personal return consists of quarterly estimated federal taxes and filing the 1040 by April 15 along with a basic state return. This is all done with turbotax or filling out forms and mailing them with payments.

To the OP, it sounds a bit complicated but not as bad as you think if you are willing to learn it. But, I do only contract work and am not employed so knowledge of this is key.

To psychmdjd. You have four psych offices and 30 employees? That's great, I'd like to hear more about your practice.

 

[psych md jd]

All forensic, all the time.

NO billing, NO insurance accepted, NO advertising, NO shortage of patients.

 

[Bartelby]

All forensic, all the time.

NO billing, NO insurance accepted, NO advertising, NO shortage of patients.

A slight derailment of the thread on my part but I'm really interested in this as well. Are these primarily disability evals, expert witness work, or what? What kinds of cases go through the practice? And do you do any clinical work or just independent evaluations?

 

[psych md jd]

I treat people who are on "supervised release." My patients are murderers, sex offenders, NGI, etc. They are all post adjudication and [mostly] psychiatrically stable. I make sure they are med compliant, not using, not re-offending, etc. If they are doing something they should not be doing, I admit them to jail. Once a year, or so, I go to court to tell how they are doing and if they are ready for unsupervised release.

 

[michaelrack]

you will pay less FICA taxes, get more business deductions, and be able to save more for retirement if you incorporate as an S-corp. You have to decide if you are motivated enough to read and learn about taxation.

The typical doc won't save anything on SS FICA (it would be hard for a doc to get away with paying himself less than 119k per year) but there is some potential for medicare tax savings. There are plenty of retirement acct options for non S-corp businesses, including sole propietorships

 

[PikminOC]

I treat people who are on "supervised release." My patients are murderers, sex offenders, NGI, etc. They are all post adjudication and [mostly] psychiatrically stable. I make sure they are med compliant, not using, not re-offending, etc. If they are doing something they should not be doing, I admit them to jail. Once a year, or so, I go to court to tell how they are doing and if they are ready for unsupervised release.

Who is paying for that? Most of those patients wont have the money for it...

 

[psych md jd]

Taxpayers.

 

[sweetlenovo88]

Taxpayers.

Sounds quite lucrative. Are there more opportunities like this in other areas?

 

[psych md jd]

Lots and lots:

http://www.stlcitycircuitcourt.com/rfps/RFP -013 Psychiatric Evaluations and Bid Sheet.pdf

https://www.omh.ny.gov/omhweb/rfp/

http://mentalhealth.vermont.gov/sites/dmh/files/RFP/DMH-PSYCHIATRY_RFP2.pdf

https://www.dhs.wisconsin.gov/business/index.htm

 

[Brownpsych]

Lots and lots:

http://www.stlcitycircuitcourt.com/rfps/RFP -013 Psychiatric Evaluations and Bid Sheet.pdf

https://www.omh.ny.gov/omhweb/rfp/

http://mentalhealth.vermont.gov/sites/dmh/files/RFP/DMH-PSYCHIATRY_RFP2.pdf

https://www.dhs.wisconsin.gov/business/index.htm

Any in Florida that you know of?

 

[psych md jd]

http://www.floridabids.net/bid-oppo...ld-Protective-Investigation-Professional.html

http://www.floridabids.net/governme...d-group-counseling-services-for-refugees.html

 

[sweetlenovo88]

Any in Florida that you know of?

I'm in Florida as well, what part you from?

 

[DD214_DOC]

Talk to an accountant or tax attorney. I think there are probably better ways to reduce one's tax liability besides incorporating. As an IC, you likely don't need the liability protection afforded by a corporation/LLC and the tax benefits really aren't that great. S-corp and LLC are pretty similar in that both (i believe) have their taxation, "passed through", so you end up just filing it on your personal income tax return anyway. It's better to reduce your personal tax liability through other means.

It's a different matter if you're going to have offices and such, though...

 

[michaelrack]

S-corp and LLC are pretty similar in that both (i believe) have their taxation, "passed through", so you end up just filing it on your personal income tax return anyway. ..

u do need to pay yourself a reasonabe salary...the feds r on the lookout for avoidance of payroll/fica/ss/medicare taxes