Salary as a Barn Manager

[PeteyPie]

[QUOTE=Wonders12;7768357]
Remember what has been said above. Your housing and 2 stalls can (and likely will as an independent contractor) be considered income too.

2200 + 1200 (housing) + 1000 (board for 2 horses at $500/month) =
4200 per month as your total compensation package as far as the IRS is concerned

4200/3 (33% to be safe since you could be closer to 35%) is $1400. THAT is what you should be setting aside monthly for taxes at the end of the year. Could you ignore that as part of your compensation when filing taxes? Sure. It’s what a lot of people do. But then just make sure you cross your fingers.

ETA: It’s a decent package as far as a BM’s salary is concerned. That doesn’t mean it’s a livable income. Only you can decide that.[/QUOTE]

I would talk to an accountant or call the IRS to make sure you are doing your taxes correctly. I thought independent contractors had to pay their taxes quarterly. If that is the case and you fail to do so, you could get a nasty penalty. I am not an accountant so I don’t know this is true, but it is something to ask about.

As for the repercussions to you if the employer does not classify you as an employee: first ask an accountant. My understanding though, is that you would not be in trouble as long as you paid your taxes. Here are some things which occur to me:

• you would not have workman’s comp and you are in a high-risk job, so injuries happen.
• you need to pay your social security tax. If you don’t, you will be breaking the law but more importantly, you won’t accrue credit.
• you will have to have your own health insurance and disability insurance.
• as I stated above, you probably need to pay taxes quarterly.
• Appsolute mentioned that you won’t get paid vacation or sick leave.
• regarding the job, not the independent contractor issue: be careful with utilities. If you are not used to paying utilities in California, water and electric can be extremely expensive.

It might work out well after all of that, because the value of the rent and horse board is considerable. Also, they might have other perks at the ranch, such as the use of a farm vehicle to save on your own car and gas expenses. The other thing is that if you are there a lot, which I imagine you will be since you will be living there, you may find it easy to save money.

[gumtree]

I am not an accountant but basic income tax numbers for someone who has “simple income” is pretty easy to come by on the internet.

Income of $9,225 up to $37,450 for a single filer is 15% (federal)

Less the standard deduction of $6,300 for a single filer.

So, they will contract you for $2,200 a month, $26,400 and I assume they will be filling and you will be getting a 1099 for this compensation.

Reported income $26,400
Less the standard deduction of $ 6,300

Taxable income $20,100

15% income tax, $3,015

SS was dropped to around 4% $800

Medicare is around 1.5% $301

California personal income tax around 4% $800

Rough total $4,916 or $410 per month.

I believe there are other deductions that can be had reducing your taxable income. It would be worth pay a few dollars to get proper tax advise.

Thanks to Obama care our health insurance went up more then 30% to subsidize the socially irresponsible people who have not been carrying health insurance and developed a pre-existing medical condition that insurance company have to insurance and pay for.
Pretty sweet deal, kind of like not carrying, paying for collision insurance and being able to get it after you have accident.

You say you are young so you should be able to get medical coverage for around $150± month.

Being called an independent contractor does not mean your are a Contractor, like in building and such. There are no licensing, bonding, business permits needed. Though California has some pretty wacky stuff going on and is always on the verge of being broke so you never know how many pockets they are trying to get into.

Yes, technically housing would be considered a benefit, perk what ever and technically should be reported. Free board being the same. Unless you are audited the IRS is never going to know about this stuff. Unless the people “contracting” you files another form similar to a 1099 for “benefits” so ask them. You have a better chance of winning the lottery then being audited with this sort of income. The only way the IRS knows how much money a person makes by and large is based on how much is run through their bank account.

Some may consider this “cheating” and if a person is being paid a large salary I would feel the same. All of the above is not advise, just laying out hypothetical numbers and how things work. The “independent contractor” determination falls more on the shoulders of the person/company contracting then the person being contracted. When it comes to taxes they may or may not owe. The contracted persons taxes are pretty straight forward as to what they have to pay. As explained to me by my accountant in my neck of the woods.

[PeteyPie]

Gumtree, you rule!

[cutter99]

Does an independent contractor need to provide workman’s comp? I understand that can get expensive!

[clanter]

[QUOTE=HJ1987;7767883]
I would assume that would be the case…The amount of money I would have to put aside for taxes does take away from the salary quite a bit also[/QUOTE]

also for the free board and the house as those would be included as income, or should be

As an “independent contractor” you would be required to pay quarterly tax payment and the amount paid needs to be at least 90% of your current years obligation otherwise it is Underpayment Penalty (form 505)

But I too do not understate the status of independent contractor when they are specifying your hours of work, providing you with the tools of the trade … that is an employee not an independent contractor

[IPEsq]

As a former IC (an “exempt” employee paid hourly), you do not have to make payments quarterly, but you can file and pay based on estimates. It is recommended to do that if you won’t be able to handle the huge tax bill in April.

You have to pay social security, state and federal taxes. You don’t have to set aside for workman’s comp, but at the same time, if you are injured on the job, you are out of luck.

[Appsolute]

@gumtree;7768866

I am not an accountant but basic income tax numbers for someone who has “simple income” is pretty easy to come by on the internet.

Income of $9,225 up to $37,450 for a single filer is 15% (federal)

Less the standard deduction of $6,300 for a single filer.

So, they will contract you for $2,200 a month, $26,400 and I assume they will be filling and you will be getting a 1099 for this compensation.

Reported income $26,400
Less the standard deduction of $ 6,300

Taxable income $20,100

15% income tax, $3,015

SS was dropped to around 4% $800

Medicare is around 1.5% $301

California personal income tax around 4% $800

Rough total $4,916 or $410 per month.

This is California. Factor in another 10% for state income taxes.

[Unfforgettable]

I’ve worked as both a salaried employee and independent contractor, with housing included. The employer was the same, and was trying to save costs…however, they had a hard time realizing that, as an IC, I could set my own hours as long as I did the job I was contracted for. They wanted me to work hours they set, which didn’t work, and I left not long after…and they were out of business shortly thereafter. During the time I was there, they also paid the stall cleaner as in IC, which was totally bogus, since an IC provides their own equipment and sets their own hours. However, what was even worse was that the stall cleaner was mentally handicapped and didn’t understand that she wasn’t an employee. Fortunately, someone :::cough, cough:::: turned them in for it and they had to pay her back wages.