Hello!

I am considering performing either contract or part-time employment with an employer in a different state (KY). I currently work full-time, remotely, in FL.

I believe because my residence is in FL that contracting will be my only option (due to employer rules on hiring out of state).

To contract, I believe I’d have to be a sole proprietor (I think) and submit a bid, etc.

I don’t need to do this financially - and am going to move to KY in the next year (making part time employment possible instead of contracting). In other words, I could just… wait or not do this at all. My main goal here is just to make some extra money - but if taxes or something was going to make me miserable then I can just not do this.

Questions:

  • What effect would contracting in a different state have on my taxes?
  • Should I just wait til I move to KY and try to go the part-time employment option instead of dealing with the sole proprietorship?
  • Any other advice / thoughts you have?
  • lemmyman@lemmy.worldEnglish
    0·
    1 month ago

    Those are all true, and I’ll add one more: many times contractors have specific expertise that warrants higher pay.

    The part I can’t reconcile basically relates to long-term contracts. I have one client who has been paying me for as much time as I can give them for about four years. On an hourly basis, I probably cost them 80% more than the fully-burdened labor cost of an equivalent W2 hire (including taxes and benefits and overhead). Or in other words, for the ~20-25 hours/week I do work for them, they could have someone working 40 hours a week instead. In this case, your second and third points aren’t really a factor, so I’m banking the extra as a “risk premium.” They seem happy to pay it.

    In a rational and efficient market (myths, I know), they would have hired a full-time W2 person to do the work I’ve been doing, long ago. And I don’t really get why they haven’t.