Belated tax confusion
May 19, 2011 10:07 PM Subscribe
Why did I seem to pay much less taxes as an independent contractor vs. a regular employee, making roughly the same hourly wage?
posted by anonymous to work & money (6 answers total) 1 user marked this as a favorite
I work in the green industry, and last year worked as an independent contractor for a local farm. Boss said I would work as an independent contractor to save him the hassle and paperwork of making me a regular employee. So I never had any taxes taken out of my checks. When it came time for taxes this year, I actually got money back from the fed (through some govt. program), and only had $200 due to the state. I would say I made roughly $6k working for this business.
I'm now working as a full-time employee for a nursery. I've already made close to $6k working there, making only a slightly higher hourly rate, and have well over $1500 taken out of my paychecks in taxes. This is more like what I thought my tax obligations would be when I filed my 1099 in April.
Could someone make sense of this for me? I can't remember the name of the federal program which got me the refund this year, but it was some sort of low-income deal I believe. Either way - if my income is similar it doesn't explain the discrepancy.
Thanks! I feel dumb