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2 Tips for Independent Consultants

No Comments » Written on July 25th, 2011 by
Categories: BenefitsForConsultants

2 Tips for Independent Consultants regarding Insurance and Expenses.

1) Health care Insurance and Business Insurances

Join our Employer-of-Record service and become a card-carrying member of our group! United Health Care provides us a package which includes medical, dental, vision, life and disability plans. Guaranteed issuance! No fear of being turned down due to pre-existing conditions.

You will also enjoy immediate access to other business insurances which include workers compensation insurance, general or professional liability insurances and errors and omissions insurance. Certificates of Insurance will be sent to your clients immediately.

2) Expenses need to be written off

You will reap exceptional rewards from our Expense Reimbursement program! Rothwell International uses the (IRS-approved) Accountable Reimbursement Plan which eliminates expenses from being reported on the Form W-2 and therefore is not included in your gross income. Your gross income will be reduced by the amount of your business-related expenses (can you imagine the immediate savings?!).

Benefits for Consultants, finally!

 

Consultants…expenses written-off?

No Comments » Written on June 13th, 2011 by
Categories: BenefitsForConsultants

 

The ability to reduce your taxes to Uncle Sam by writing off your expenses is one of the main reasons that people choose to go the ‘independent consulting’ path.  You can write off meals, home-office, supplies, computers, fax machines, cell phone, gas, mileage, hotels, etc. etc.

If you are being forced to go through a W2 relationship, than you may be missing out on all these tax optimizations (unless you go with an Employer-of-Record that uses an Accountable Plan as their payroll method).  Even if you are incorporated, you must be extremely diligent and self-disciplined to keep up with your business-related expenses (no one but yourself can do that!).

If you are using an Employer-or-Record model, it is extremely helpful that they keep you motivated to keep track of (and submit) your expenses weekly/monthly so that you can get as much tax benefit as possible. If you wait till the end of the year, than you are guessing as to your expenses…and quite often you will under-guess.  Plus if you get audited, you will be scrambling to grab those receipts.

So, if you are feeling less than efficient with your tax preparation/expenses submittals, than consider going through an Employer-of-Record model.  With your Employer-of-Record, you’ll be able to take advantage of their many, many services that are provided to you as well.

To request more advice about this topic or to see if you are efficiently writing off your business-related expenses, go to the top of this page (www.Rothwell-International.com) and click the button  “Get Your Free Assessment” today!

Jill Freeman is a consultant’s consultant. For more information on this message or on the employer-of-record model, contact her at [email protected]

 

Tips for a new Consulting business

No Comments » Written on May 16th, 2011 by
Categories: BenefitsForConsultants

How can independent consultants drive down their taxes?

What are your business structure options?

Independent Consultants (ICs) land in this career due to 2 different situations:

1)  This career is chosen.  ICs can have as many projects/clients as they want. They create their own rates, work their own hours, and so forth.… all while being able to write off all business-related expenses in order to reduce tax liability.  The independence from corporate bureaucracy can be a breath of fresh air.

2) This career is forced upon them.  This happens when an individual is given a project to complete, rather than a full-time job (projects are becoming a typical way for companies to get work done in this new era).  This contractor is now a consultant running his/her own business!  The IC has to now handle all the tasks and strategies that go along with being a business-owner.

What business structures are options for the Independent Consultant?

1) You can choose to run your consulting company showing income solely on 1099’s.  Your  business related expenses can all be written off to decrease your tax liability.  The negatives to this structure are: a) some clients are unable to work with 1099s (compliance issues),  b) you’ll need to hire brokers (to get your own health care and business insurances) and you’ll need to hire an accountant/bookkeeper to organize your back-office tasks and deal with your taxes (quarterly payroll taxes and tax optimization). You are able to invoice your clients and handle the collection calls yourself.

2)  You can legally set up a business.  There are several legal structures in which to set your business up. The most common forms of business are sole proprietorship, partnership, corporation, S corporation and a Limited Liability Company (LLC). Go to http://www.irs.gov/businesses/small/article/0,,id=98359,00.html for specific information on the details of these forms of business.  An Accountant will be helpful in order to choose the type of structure (you can set up the business on your own or hire an attorney), and then the accountant will help you determine the rules for your corporation and expenses, help you with P&L statements, balance sheets and possibly file your taxes.  You will choose insurance brokers to help you get your own health care insurance and business insurances (Workers Compensation, Liability, Errors and Omissions, etc.).

3) Another method for running your consulting business would be to work with an employer-of-record. If your chosen employer-of-record uses an IRS-approved Accountable Plan, you can reduce your taxable income by all of your business-related expenses.  They will file all of your quarterly taxes, and possibly provide health care insurance and business insurances (such as Workers Comp, Liability, Errors and Omissions, etc.).  With an employer-of-record, an Independent Consultant can get away without needing the help of insurance brokers and accountants or bookkeepers. Though they will be in essence a W2 employee, they can have as many projects/clients as they want, choose their own rates, work their own hours, and so forth.…all while being able to write off all business-related expenses in order to reduce tax liability.  Employer-of-records also provide all the back-office services (invoicing/collections and payroll) too.

Lots to choose from…  Happy exploring!

Jill Freeman is a consultant’s consultant. For more information on this message or on the employer-of-record model, contact her at [email protected]

 

Consultants choose an Employer-of-Record model

No Comments » Written on May 2nd, 2011 by
Categories: BenefitsForConsultants

Independent Contractors like to be “independent” for various reasons including:

  • they can write off all their expenses
  • they are free to work where and when they want
  • they can make higher hourly rate than if they were a corporate employee doing the same work
  • etc., etc.

But they do not like certain things that hold them up (and make their life more difficult).  These tasks keep them away from the work they know and love, and waste their valuable time.

  • Not being able to get on a group health insurance plan (sometimes they may have some medical issue that denies them insurance altogether). Dealing with insurance brokers altogether is burdensome (Workers Comp, Liability, Errors and Omissions too).
  • They hate the administrative junk that goes along with a business (invoicing, collections, taxes, insurance brokers, etc.)
  • They lose some contracts because a potential client company can’t bring them on as a 1099 (due to compliance reasons).

So…companies like Rothwell International takes care of all of these issues for the Independent Contractor.  But to do that, the ‘Employer of Record” model is needed. But we don’t care how many clients they have streaming through us, they find their own contracts, they set their own rates, they set their own work schedules, etc.

Rothwell uses an IRS-approved Accountable Plan for payroll…which allows the consultant to deduct all of their business-related expenses from their taxable income.

Most payroll providers don’t allow the consultant to have this level of freedom (especially with allowing all of their business-related expenses to be written off and saving all of that tax).

Plus, we don’t charge any margin or fee or hourly rate to a client company (this is a huge difference between us and a payroll provider).  Our fee to the contractor is $75/week admin fee (we also have a sliding scale statutory fee that covers the overhead we endure for the consultant’s tax burden that we bear).  The tax savings themselves pay for this fee alone.

Interested in checking this model of doing business out more closely?  Go to: www.BenefitsForConsultants.com and let us know that you want a “Free Assessment.”

 

 

Crowdsourcing (a mini outsourcing concept)

No Comments » Written on April 2nd, 2011 by
Categories: BenefitsForConsultants

Understanding Crowd Sourcing

New Solutions for Small Businesses?

What is Crowdsourcing? Wikipedia defines “crowdsourcing” as:

“the act of outsourcing tasks, traditionally performed by an employee or contractor, to an undefined, large group of people or community (a “crowd”), through an open call.”

Typically, crowdsourcing involves broadcasting a problem via the web and asking a large group of unknown individuals to solve the problem. Either the crowd or the asking individual can determine which solution is the best, and reward the winner either monetarily or via recognition. Crowdsourcing can also be used to do piecework; things that could take you hundreds to thousands of hours can be assigned to a “crowd” do be completed in days.

Crowdsourcing
Some examples of crowdsourcing are:

1 Design work. Numerous web sites allow users to submit a design project and have designers bid on the work. In other cases, designs are pre-submitted from the “crowd” and the user then pays for the winning submission.
2 Programming. The same concept is used for programming applications and designing websites. Web tools are available to have your program application done quickly and often cost effectively.
1 Data Entry. Have a large collection of small parts that need to be sorted for your website? You can use crowdsourcing to have the parts cataloged and categorized for you on a price per piece basis. Each member of the crowd gets paid for the portion of the work they complete.
1 Data Classification. Take a large set of data and have the “crowd” help you sort through it. NASA has used crowdsourcing to help document its library of photos and even help prioritize the images it takes from the Mars Orbiter. They did this by launching a tool and asking the public to participate in their organization project.

How can Crowdsourcing Help?

Check Businesses. You can use crowdsourcing to develop a new business logo, design a website, evaluate/sort data, or get feedback on a new product or service. Essentially, crowdsourcing allows you to cost-effectively tap into a huge network of affordable freelancers.
Check Freelancers. Crowdsourcing can be a great way to drum up new business. Websites exist to source new work from a wider geographic area than might otherwise be available to you. These crowdsourcing websites that connect businesses with freelancers generally collect a small one-time fee, although others take a percentage of the total transaction.

Sample websites:
www.99designs.com: allows customers to submit a call for identity, web, print, graphic, or merchandise designs, set a price, and select a winning design.

www.vWorker.com: allows customers to access thousands of computer programmers around the world

www.CloudCrowd.com: helps business owners or individuals access editing, translating, copywriting, and PR services

Is there a downside? Some of the issues that come up when discussing crowdsourcing include making confidential information public, out-sourcing local work to third world countries, and uncertainty about the quality of work done by the “crowd”. While there are varied opinions about the value of crowdsourcing, the concept appears to be here to stay.

 

Retrieved from a great newsletter dated April, 2011 written by: Tarantino and Co., CPAs.  http://www.tarantinoco.com/

Consultants can get group healthcare insurance!

No Comments » Written on March 28th, 2011 by
Categories: BenefitsForConsultants


With the onslaught of healthcare insurance dilemmas for anyone but the young and healthy, Rothwell is determined to provide an extremely thoughtful and unique solution for contract consultants. Become a member of our group, and receive access to great group health care insurance (lower deductibles than most health care insurance you could choose on your own).   Also receive more tax help than you thought possible!

It is our vision to provide almost any service that contract consultants need on a day-to-day basis so that your life can be as hassle free as possible.  We will submit your taxes quarterly (no trying to save tens of thousands of dollars each year to pay back to Uncle Sam).

For a small weekly fee ($75/week pretax) and another fee that is based on a sliding scale to cover our overhead of taxes, you can get EXTREME services that will send your consulting life into a whole new realm.  You will feel comfortable because you and your family will be secure and stable, with a group health care insurance plan, every tax optimization possible, invoicing and collections, business insurances, compliance, etc., etc.

Sign up today at www.BenefitsForConsultants.com.

Or call Jill Freeman at 770-289-9502

How many 1099 Independent Contractors work for your company?

No Comments » Written on March 1st, 2011 by
Categories: BenefitsForConsultants

How many 1099 Independent Contractors work for your company?

I’m here to broadcast (by megaphone) that it is essential to classify your Independent Contractors (IC) correctly or there may be cause for an audit of your company in 2011.  Your company may be a target of the IRS if you’re in an industry that typically engages 1099s.

Yes, ICs and consultants are an important part of America’s workforce.  Project-oriented employment is very prevalent in today’s economy.  But with the growing number of contractors, comes increased risk for employers.

It is important to pull your head out of the sand!  There are landmark cases clearing the way for increased legislation, fines and penalties for improperly classifying workers.  Intelligent business leaders MUST realize they are a short distance away from federal or state audits.  The Revenue departments want their tax revenue!

Rothwell can help!

  • We’ll build a 1099 process for you that ensures the proper classification of all of your current as well as newly hired 1099 Independent Contractors.
  • To retain your loyal consultants, we can create a compliant environment by bringing them into Rothwell’s Employer-of-Record program.  This model is a program especially suited for consultants who desire to maintain their independence.  They receive health care insurance benefits, business insurances (which mean Certificates of Insurances for you), tax optimizations (that will equal or better their self-employed tax savings), and all the back-office services they would like to utilize.

Contact us today!  Keep your independent contractors happy, yet compliant!

[email protected]

www.BenefitsForConsultants.com

Tip of the Month for Independent Contractors

No Comments » Written on February 18th, 2011 by
Categories: BenefitsForConsultants

Tip of the Month

for Independent Contractors


Use an Employer-of-Record* to

reap 3 great advantages

*payroll/accounting method must be “Accountable Plan”

1. Lower your taxes by thousands of dollars each month/year! Use your business-related expenses to reduce your taxable income. You’ll see these savings immediately, not at the end of the year. Your business-related expenses will be stream-lined. You will reap major tax savings!!!

2. Join a Group Health Care Insurance Plan (pre-tax of course). Knowing that you are guaranteed to get on the insurance plan is a big relief! You also are relieved of the task of attaining Certificates of insurances that your clients request (Workers Comp, Liability, Errors and Omissions, etc.). No need to deal with multiple insurance brokers. 401K is typically a benefit offered as well.

3. Automatic tax filing. Quarterly, your taxes will be automatically filed with the State and the Federal Revenue departments. The taxes will equal your self-employment taxes (but remember that those business-related expenses reduce your taxable income by a bunch!). As an added plus, you finally get to contribute to your Unemployment Insurance account, and your Medicare account. The latter may be a nice asset for the day when you actually retire!

4 Tips for an Independent Contractor to keep more of your earnings in 2011

2 comments Written on January 17th, 2011 by
Categories: BenefitsForConsultants

4 Tips for an Independent Contractor to keep more of  your earnings in 2011

1.  Create a habit to log all of your business-related expenses.  Don’t forget mileage from your home office to the client’s office, tuition and related expenses, professional fees and more.  Extra tip:  If you have a smart phone, there are some great Expense-Tracking apps where you can also take pictures of your receipts! (Xpenser or free ones).  How easy (if you make this a habit)!  These expenses can really rack up some good tax savings at the end of the year!

2.  If you are a W2 employee or using an ‘Employer of Record,” ask if they use an Accountable Plan for payroll purposes.  This model reduces your tax liabilities immensely by reducing your taxable income by all of your business-related expenses (see above).  Put your money in your pocket instead of Uncle Sam’s.

3.  Do price comparisons with your insurance brokers to ensure you are getting the best premiums for your health care insurance, as well as your business insurances such as Liability, Errors and Omissions, Umbrella policies, etc.  This can be hundreds of dollars a month in premiums (these premiums can reduce your tax liabilities, so keep track of them!).  By the way, health care insurance ‘deductibles’ are not able to be written off on your taxes…just the premiums…so it is better to have a higher premium with lower deductibles (rather than lower premium and higher deductible) when it comes to a tax savings.

4.  Stay on top of your invoicing and collections.  Make it a habit to immediately invoice a client on the same day your hours end.  Make a friendly reminder phone call when the invoices are 30/60/90 days old (and email a statement).

Go through an Employer-of-Record that gives you access to the above services (Accountable Plan, free access to business insurances, group health care insurance. Invoicing and collections and more).  Try: www.BenefitsForConsultants.com

Benefits to the Independent Consultant

No Comments » Written on November 22nd, 2010 by
Categories: BenefitsForConsultants

Benefits to the Independent Consultant

Finally, Independent Contractors can also have immediate access to company benefits.  Join us and become a card-carrying member of this group and get all the advantages like healthcare insurance (guaranteed issuance!), 401K, Workers Comp, business and professional liability insurances, Unemployment insurance and much more!

In addition to these benefits you will also reap exceptional rewards from our expense reimbursement program!  Maximize your tax benefit and increase your net take home pay! Categories of reimbursable expenses which reduce your taxable income are:

Business expenses – These expenses include, but are not limited to, computer and office supplies, meals, professional fees, cell phone, automobile expenses/mileage, advertising,  per diem, etc.

Medical expenses – Qualified medical expenses including prescriptions, deductibles, copays, items not covered by insurance, etc. up to $10,000 per year. The benefit is realized in your next pay cycle, without having to wait for an income tax refund!

Dependent care – Dependent care expense reimbursements up to $5,000 per year are available to qualified individuals and families. Eligible expenses can include child daycare, adult daycare, after school care, etc.

Educational expenses – Up to $5,250 per year in qualified educational expenses can be reimbursed tax free. Receive reimbursements for tuition, books, related fees, etc.

After 6 months of membership you will receive an added benefit of having your individual income tax returns prepared at no additional charge.

Rothwell International can provide you with all of the above benefits and tax optimizations as well as save you every hour of the week that you may spend billing your clients and collecting on your invoices.  Let us do the work for you!

Benefits for Consultants, finally!