The Difference Between a 1099 and W2 | Online Teaching as an Independent Contractor
#onlineteaching #budgetingtips #independentcontractor
If you're anything like me, before online teaching you only held jobs that provided a W2. I had no idea how to budget when my employer wasn't withholding taxes for me!
Before we go any farther, I'd like to preface this by saying this: I am not an accountant, tax professional, or anything of the sort. Please don't consider this financial advice. I'm only sharing the most basic of differences in this video.
When I became an independent contractor, I quickly learned how to budget my paychecks so that I didn't owe huge chunks of money at the end of the year.
What worked best for us: separate bank accounts. We use a primary bank account for our normal spending, and I keep a certain percentage in a separate account for taxes.
What I've also seen work for other online teachers: paying quarterly, manually moving over their percentage, delegating a certain percentage be moved over through their company (not all will do this).
What works best for you will vary, but it's important to know your options, and how you differ from a full time, w2 employee!
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