ER Doc Advisor - Financial Planning & Taxes for Emergency Physicians

EP 79: The Perfect Mixture of 1099 Vs. W-2

ER Docs have a unique characteristic of being “hybrid earners,” meaning accepting income both as an employee earning a W-2 and as a contractor earning 1099 in the same year. And we find a large percentage do exercise this ability; if not in most years, eventually at some point in their careers. So that begs the question: is there a perfect mixture of 1099 vs. W-2 that yields specific advantages, like tax savings and retirement deferral opportunities? And is there a point where earning too much of one over the other yields diminishing returns?

Nobody wants to work more to earn less, so we’ll look into those questions on today’s episode and get into what that hybrid-earning “sweet spot” could look like.


Topics Discussed:     
  • How many filed tax returns were audited this past year.
  • The two steps you must complete to make tax season easy.
  • How being a C-corp versus an S-corp impacts your taxes.
  • The advantages (and disadvantages) of earning 1099 income.
  • How to find the sweet spot of earning 1099 income.
  • Whether there is a sweet spot for earning W-2 income.
  • At what point it makes sense to open an entity.
Resources Mentioned:

Tags

planning, financial planning, ER doctor, doctors, finances, tax season, taxes, finances,

by 
Scott Wisniewski, EA