Скачать или смотреть Employee vs Contractor Tax Guide: Why Fighting for W-2 Status Can Cost You Money

You receive a 1099-NEC and realize you are paying the full 15.3% Self-Employment Tax. You naturally feel "misclassified" and want to fight the IRS to be treated as an employee (W-2) so your boss pays half that tax. Stop. This is often a pyrrhic victory. Thanks to the Tax Cuts and Jobs Act, employees are barred from deducting "Unreimbursed Employee Expenses" on their federal return. By fighting for employee status, you might save 7.65% on FICA but suddenly lose the ability to write off thousands in business expenses, resulting in a higher total tax bill on "Phantom Income."

As The Finance Observer, I’ve performed a forensic review of the "Classification Math" and the specific forms used to challenge your status. In this video, we dissect the "SS-8" process, the hidden cost of winning that battle, and why remaining a 1099 contractor is often the superior tax position—even with the higher payroll tax.

FORENSIC BREAKDOWN:

0:00 The "1099 Surprise": Why the 15.3% tax bill shocks freelancers

0:52 The Instinct: The 7.65% incentive to fight for W-2 status

1:58 The Law: The IRS "Right to Control" Test (Behavioral, Financial, Relationship)

2:51 The Mechanism: Filing Form SS-8 (The Determination) & Form 8919 (The Payment)

3:57 The Trap: How the Tax Cuts and Jobs Act killed the "Unreimbursed Employee Expense" deduction

4:17 The "Phantom Income" Math: Why earning $100k as an employee is worse than $100k as a contractor

5:15 The State Exception: Decoupled states (like NY) that still allow the deduction

5:49 The Verdict: Why you must run the numbers before filing Form SS-8

DISCLAIMER: I am The Finance Observer. This content is for educational purposes only. Worker classification is a complex legal determination based on the "Common Law" rules; always consult a qualified CPA or Tax Attorney before filing Form SS-8, as it will trigger an inquiry into the hiring business and cannot be undone.