Re: Payment Delay in 1099 Employment Contract

Subject: Re: Payment Delay in 1099 Employment Contract
From: Trish Robertson <trish -dot- robertson -at- comcast -dot- net>
To: Phil <philstokes03 -at- googlemail -dot- com>
Date: Tue, 19 Apr 2011 10:35:41 -0400

Hi, Phil,

A 1099 form is an information return, though colloquially called a tax return, which is used to report income other than wages, salaries, and tips. It is used most commonly by independent contractors or non-employees who are usually paid hourly rates or lump sum fees. The contractor is responsible for paying her own federal, state, and social security taxes. There are no deductions taken out by the payor. This means the contractor should charge 30% - 50% more than usual rates for such jobs.

Hope this helps.

Best, Trish


On Apr 19, 2011, at 10:03 AM, Phil wrote:

> For the novices-but-keen-to-learn among us, could you explain what a '1099' means?
>
> Thx!
>
> Phil
> On 19 Apr 2011, at 20:33, Laura Lemay wrote:
>
>>
>> Net 30 is good terms for a 1099 these days. Most 1099 contracts are net 45, net 60 or these days sometimes even net 90. And a lot
>> of times a net 30 still requires daily phone calls and threats to stop work after the 30 days have gone by with no check.
>>
>> If you were paid in two days on a previous 1099 contract you had a terrific and rare deal. In 15 years of consulting I've only had one company that paid within a week.
>>
>> Laura
>>
>>
>> On Apr 19, 2011, at 5:14 AM, Trish Robertson wrote:
>>
>>> Hi,
>>>
>>> I just received a contract for a six- to eight-week gig on a 1099 that states these payment terms: "$X per hour billed bi-weekly and payable net 30 days." I am very uncomfortable with that delay. Not only do I need money sooner than six weeks, but, potentially, I could complete my contract before seeing any money--and who knows whether they will pay.
>>>
>>> Previously, when working on a 1099, I was payed within two days.
>>>
>>> I believe that in Massachusetts, permanent employees must be paid bi-weekly, but are there any rules governing the timeliness of payment to consultants/contractors?
>>>
>>> Does anyone have any insight about this issue?
>>>
>>> Thanks, Trish
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Follow-Ups:

References:
Payment Delay in 1099 Employment Contract: From: Trish Robertson
Re: Payment Delay in 1099 Employment Contract: From: Laura Lemay
Re: Payment Delay in 1099 Employment Contract: From: Phil

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