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Retired from an OEM, then came back and worked for same OEM as a PT W-2 worker. Could only work up to 1000 hr per year. Leadership decided to end the PT W-2 positions. They are considering bringing some of us back as 1099's. I know nothing about 1099 work. I've been W-2 for 40 years. What do I need to be aware of. I'm not going to assume that HR is going to have my best interest at heart when developing a contract. Administrative tasks will be from home. There will be local travel required using my vehicle and/or flying There will be overnight travel required. There may even be international travel required.

Any advice is appreciated.

For non-US users, W-2s and 1099s are tax forms provided by employers to their employees. W-2s are provided to regular employees and 1099s are provided to contractors.

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    Could you add at least a country? Or explain all those Numbers?
    – guest
    Commented May 14, 2020 at 8:16

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This list is non-exhaustive.

1099:

Your customers will send you a 1099-MISC form each year stating how much they paid you. It's solely up to you to pay any applicable income taxes.

You'll pay for your own healthcare and retirement benefits, and anything else an employer would typically pay for.

You won't get paid vacation or sick days. If you're being paid strictly on the basis of hours worked then you won't get paid when you take time off.

You'll have more freedom in choosing what kind of work you want to do and what kind you don't want to do.

You'll have more freedom to set your own hours and schedule.

You'll have more freedom in choosing who you will and won't work with.

You'll be free of almost all company politics. As a 1099'er myself I don't know, care, or get involved in the internal company politics of my customers.

Your customer should reimburse your travel expenses and you should bill for your travel time and mileage. While you're traveling for work on your clients behalf you can't be performing work for, and earning money from, other clients. Your customer should pay for that time and for those expenses. I bill for travel time and I expense my mileage. You can and should do both if you're using your own vehicle. Contrary to popular belief, it's not one or the other, it's both. Your travel time is billable just as it would be when you're performing actual work. Your mileage is an expense that should be reimbursed.

There are many online calculators, articles, etc. to help you determine how much your billable rate should be, but it should account for the costs that the employer is no longer paying and that have shifted to you. My hourly rate is about 33% higher than I'd typically earn as a salaried employee.

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  • As someone who has no clue what 1099 means, reading this I now have a good idea, hope the OP gets it. well done, plus 1.
    – Solar Mike
    Commented May 14, 2020 at 7:47
  • In the USA, a 1099'er is a freelancer. 1099 refers to the IRS form you receive from your customers each year stating how much they paid you throughout the year. You use the 1099 information to pay your income taxes. It's essentially the equivalent to the W2 IRS form that traditional employees receive from their employer.
    – joeqwerty
    Commented May 14, 2020 at 13:47
  • Thank you Joe for such a detailed answer. I guess I'm also looking for more answers though. - As a 1099, am I still covered by FLSA regarding OT laws? - Are there any contract language issues that I may need to be aware of? - Can I negotiate something like any air travel more than 3 hours will be in Business class or better? - Thanks to any and all
    – Kelly
    Commented May 14, 2020 at 18:34
  • Glad to help. Just adding my two cents. Hopefully you'll get some additional answers.
    – joeqwerty
    Commented May 14, 2020 at 18:39
  • I'd also add that the OP's company may require him to carry various forms of insurance, and that it will be up to the OP to generate, submit and chase up his own invoices.
    – Peter M
    Commented May 15, 2020 at 20:11
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IMHO, you should make sure to have expense reimbursement details in the contract

It should state who makes reservations and maximum class of travel / accommodation

Confirm travel time as billable time

Your per diem when traveling

And vehicle expenses calculation scheme (fuel or miles)

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