Hi,
I'm very new to all this tax/legal stuff. I'm really worried about my situation right now..
I'm a Canadian living in the US on a 1-year TN as an independent contractor for a startup. I make very little, less than $20k/year in base, because we've agreed on me receiving an equity share of future projects.
I just realized the other day I was supposed to file quarterly estimates so I missed the previous deadline.
1. What taxes do I pay for and how much? Do I have to pay for medicare and social security, despite probably not ever using them in the future?
2. My firm never issued me a W9, are they supposed to?
3. Since I'm making so little money, is there a way I can reduce my taxes?
Thank you. I really appreciate any help.
TN and taxes
Moderator: Mark T Serbinski CA CPA
The rule of thumb is to send 1/4 of your check to IRS on a quarterly basis.
Since you live in US, you will be on the hook for Self-employment tax (which is both sides of SS and medicare), since you are not an employee.
W-9's are not issues. Do you meand W-2? Your are a contractor, so you should be issued a 1099 not a W-2, or you are being paid corp-to-corp, in which nothing is sent to you
Was your remunerationa arrangemnt properly spelled out on your TN letter and accepted by border officer?
Don't forget to file your Cdn departure return (I assume you left in 2014) so that you are no longer taxbale in Canada on your US income.
Since you live in US, you will be on the hook for Self-employment tax (which is both sides of SS and medicare), since you are not an employee.
W-9's are not issues. Do you meand W-2? Your are a contractor, so you should be issued a 1099 not a W-2, or you are being paid corp-to-corp, in which nothing is sent to you
Was your remunerationa arrangemnt properly spelled out on your TN letter and accepted by border officer?
Don't forget to file your Cdn departure return (I assume you left in 2014) so that you are no longer taxbale in Canada on your US income.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
Thanks for the fast reply nelsona.
Yes I meant 1099, should I have that filed asap?
Also I did some research and I saw that quarterly payments are only necessary if your total taxes for the year exceed $1k. Since I work from home, I believe I can deduct rent as a business expense from my taxable income, along with other businesses expenses like travel? That would make my taxable income low enough that I don't even think my total taxes would exceed $1k. Is this correct?
Yes I meant 1099, should I have that filed asap?
Also I did some research and I saw that quarterly payments are only necessary if your total taxes for the year exceed $1k. Since I work from home, I believe I can deduct rent as a business expense from my taxable income, along with other businesses expenses like travel? That would make my taxable income low enough that I don't even think my total taxes would exceed $1k. Is this correct?
The person paying you issues a 1099. You use that on your tax form.
Do your taxes and find out.
I'm surprised CBP allowed you to live in US on such a low remuneration.
All the best.
Do your taxes and find out.
I'm surprised CBP allowed you to live in US on such a low remuneration.
All the best.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best