Help me choose between W2 and 1099

[Thepassageofgas]

Hello all.
I’ve seen some other posts and Im curious for people to weigh in on my situation.

I have a W2 job with a group I love. I make 400k. We’ve lost a lot of people to the allure of 1099 life, and now call is at least once a week, sometimes more. A busy OB service. Up a good chunk of the night with epidurals and whatnot. I am not a partner, and at this stage it doesn’t appear that partnership is in the cards for me. Sometimes, the days can be long, and it starts to be a bit annoying when the same people leave early and i (and a small group of others) are left holding the ball. There’s no incentive to stay late, no OT per se because we’re salaried and im sure this is a lot of peoples experience.

I also do some 1099, and was asked to come aboard “full time”, basically as much as i like. The hourly rate is 300-350/hr to cover CRNAs in a community hospital, sometimes doing my own cases. No call unless I want to, which is 6k for 24 hours. I can also work at GI centers making 270/hr (which i don’t enjoy and i think i’ll avoid GI as much as i can).

I told my group of the offer, and they countered by offering to increase my vacation weeks from 8 to 14, allowing me to work more as a 1099.

My concern is, I have a ton of med school debt (like a TON), and i’m single, so i’m pulling the cart alone. If I take the offer my group put forth, my fear is thar Im
still going to be subject to the insane taxes and get none of the cool deductions the 1099 peeps get (I’m in a blue state, we pay a lot of taxes).



Has anyone else had experience in this situation? Any thoughts on this?

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[TeslaCoil]

I think in most cases a W2 is gonna be the way to go. Unfortunately tax codes over the years have really cracked down on what you can deduct on a 1099. When you consider the extra 10% tax thats tacked on, you're gonna have to make a lot of deductions in order to make up the difference. If you think that you will have a lot of "overhead" in running your "business", and will amass enough deductions then it would make sense to go the 1099 route, then do that. But there are rules you'll have to consider when calculating your deductions- for instance, only a certain amount of business meals can be deducted, if you want to deduct your gas you will have to horde receipts and keep a milage log, if you want to deduct car costs, then it has to be a leased vehicle (cannot be owned). etc etc. You'll have to do the footwork in actually calculating some of this stuff to decide if a 1099 is actually worth it to you. Other factors that you have to consider are- does this 1099 pay for your malpractice insurance or will you carry your own? Do they provide tail/nose coverage? If not, those can be hefty. What benefots are you getting from the W2 job that you wont be getting in the 1099 job? Will you have to have your own health, dental, vision, disability insurance? If so all of those costs may add up to the point where it doesnt make sense to go that route. I would make a sheet with two columns and really compare the details and try to calculate an estimate of the differences...

 

[Thepassageofgas]

I think in most cases a W2 is gonna be the way to go. Unfortunately tax codes over the years have really cracked down on what you can deduct on a 1099. When you consider the extra 10% tax thats tacked on, you're gonna have to make a lot of deductions in order to make up the difference. If you think that you will have a lot of "overhead" in running your "business", and will amass enough deductions then it would make sense to go the 1099 route, then do that. But there are rules you'll have to consider when calculating your deductions- for instance, only a certain amount of business meals can be deducted, if you want to deduct your gas you will have to horde receipts and keep a milage log, if you want to deduct car costs, then it has to be a leased vehicle (cannot be owned). etc etc. You'll have to do the footwork in actually calculating some of this stuff to decide if a 1099 is actually worth it to you. Other factors that you have to consider are- does this 1099 pay for your malpractice insurance or will you carry your own? Do they provide tail/nose coverage? If not, those can be hefty. What benefots are you getting from the W2 job that you wont be getting in the 1099 job? Will you have to have your own health, dental, vision, disability insurance? If so all of those costs may add up to the point where it doesnt make sense to go that route. I would make a sheet with two columns and really compare the details and try to calculate an estimate of the differences...

I should have clarified. So:
The 1099 has malpractice (2m/5m).

My W2 will not pay my tail, but in their desperation, the 1099 agency will. I can also still 1099 with my current W2 group to make sure i’m truly a “contractor” (not just working at one site). They will pay medmal for those instances.

You’re right: I do have to pay my own disability, healthy and dental insurance. But if I’m a 1099, don’t I get to deduct those costs? I do lease a vehicle incidentally, so I’d deduct that too. But you’re right, Im
going to try to make that excel document you indicated and compare it head to head!!

 

[Thepassageofgas]

Depends on your retirement benefits with this w2 practice. If you’re getting the full 60k with an employer match then you should stay and work enough as 1099 to make your solo 401k get a full employer contribution from your 1099 profits. Then you can put away 100k a year tax deferred in retirement. That’s an absurd amount by anyones definition.

Having said that, 325 an hour on average will gross you 572k working 44 weeks a year at 40 hours. In that case 1099 comes out way ahead.

Right, and that’s giving myself a fairly generous amount of vacation. And there are definitely days they ask me to work more, but it’s on the clock, so I don’t mind at all. ughhhh, a lot of swirling numbers!

 

[DrNut]

Your w2 job doesn't cover tail insurance (red flag)? Does your W2 job provide good benefits? health care 401k match etc?

The market is great now but may not last forever. What do you risk leaving the w2 job? you could always come back to it. esp if you're never going to make partner. I'd go the 1099 route and get compensated for my time.

If benefits and workload is reasonable for the salary then id keep the w2 job and work extra as 1099 on my vacation.

I work w2 and 1099 and have the best of both worlds. My W2 pays my employer payroll taxes, provides 401k with match, and benefits. my 1099 income is >$300k and I do a full $61k solo 401k. I can buy stethoscopes, books, cme, laptops, cell phone bills, etc and deduct it from my business.

 

[Thepassageofgas]

Your w2 job doesn't cover tail insurance (red flag)? Does your W2 job provide good benefits? health care 401k match etc?

The market is great now but may not last forever. What do you risk leaving the w2 job? you could always come back to it. esp if you're never going to make partner. I'd go the 1099 route and get compensated for my time.

If benefits and workload is reasonable for the salary then id keep the w2 job and work extra as 1099 on my vacation.

I work w2 and 1099 and have the best of both worlds. My W2 pays my employer payroll taxes, provides 401k with match, and benefits. my 1099 income is >$300k and I do a full $61k solo 401k. I can buy stethoscopes, books, cme, laptops, cell phone bills, etc and deduct it from my business.

We do get 401k match, covered health insurance with no out of pocket, but my immediate curse is student loans. it’s all i can think about, and i just want to bolus my money toward that and free myself of that yoke.

do you pay taxes on your 1099 or do you have so many deductions you basically don’t have to (somehow)??? do you have a CPA? do you take deductions for mileage car home office etc? or can you only do a *percentage* because you aren’t 100% 1099?

 

[abolt18]

Hello all.
I’ve seen some other posts and Im curious for people to weigh in on my situation.

I have a W2 job with a group I love. I make 400k. We’ve lost a lot of people to the allure of 1099 life, and now call is at least once a week, sometimes more. A busy OB service. Up a good chunk of the night with epidurals and whatnot. I am not a partner, and at this stage it doesn’t appear that partnership is in the cards for me. Sometimes, the days can be long, and it starts to be a bit annoying when the same people leave early and i (and a small group of others) are left holding the ball. There’s no incentive to stay late, no OT per se because we’re salaried and im sure this is a lot of peoples experience.

I also do some 1099, and was asked to come aboard “full time”, basically as much as i like. The hourly rate is 300-350/hr to cover CRNAs in a community hospital, sometimes doing my own cases. No call unless I want to, which is 6k for 24 hours. I can also work at GI centers making 270/hr (which i don’t enjoy and i think i’ll avoid GI as much as i can).

I told my group of the offer, and they countered by offering to increase my vacation weeks from 8 to 14, allowing me to work more as a 1099.

My concern is, I have a ton of med school debt (like a TON), and i’m single, so i’m pulling the cart alone. If I take the offer my group put forth, my fear is thar Im
still going to be subject to the insane taxes and get none of the cool deductions the 1099 peeps get (I’m in a blue state, we pay a lot of taxes).



Has anyone else had experience in this situation? Any thoughts on this?

Seems to me 1099 comes out as a winner financially, however which job wins the quality of life contest? Sounds like your current employer was happy to keep screwing you over until you put on your walking shoes. More work for the same money (despite inflation) seems to have been the status quo. At least with the 1099 gig you work more you get paid more.

Are you already working with crnas? Do you want to continue working with them? Seems that could be a major factor as well.

 

[GoBeers]

We do get 401k match, covered health insurance with no out of pocket, but my immediate curse is student loans. it’s all i can think about, and i just want to bolus my money toward that and free myself of that yoke.

do you pay taxes on your 1099 or do you have so many deductions you basically don’t have to (somehow)??? do you have a CPA? do you take deductions for mileage car home office etc? or can you only do a *percentage* because you aren’t 100% 1099?

best to get a CPA for peace of mind
mileage gets you ~50 cents per mile.
taxes can be paid as 1099 quarterly, annually, monthly, however you want to set it up with your CPA
if you have s-corp, you can figure out ways to distribute dividends , therefore be taxed only 15%

 

[kidthor]

I am not a partner, and at this stage it doesn’t appear that partnership is in the cards for me.

Why isn’t partnership in the cards for you? Especially if the place is hemorrhaging people and you’re left to pick up the slack? Any why are you working late when a group of insiders leaves early all these time? Why do you love a group that seems to be exploiting you (perhaps only partially, but you’re not getting the deal that some others seem to be)?

 

[GassYous]

Why isn’t partnership in the cards for you? Especially if the place is he hemorrhaging people and you’re left to pick up the slack? Any why are you working late when a group of insiders leaves early all these time? Why do you love a group that seems to be exploiting you (perhaps only partially, but you’re not getting the deal that some others seem to be)?

Exactly. Call once a week, busy ob, late days and only 400? Sounds like it should be at least 50% higher if not double

 

[Dr. Rude]

If you are willing to be "aggressive" on your tax returns, the 1099 life is probably the way to go. Risks of being "aggressive" might show up.

 

[GassYous]

If you are willing to be "aggressive" on your tax returns, the 1099 life is probably the way to go. Risks of being "aggressive" might show up.

I think it is not worth it now because of all the irs agents being hired.

 

[D P356]

Why isn’t partnership in the cards for you? Especially if the place is he hemorrhaging people and you’re left to pick up the slack? Any why are you working late when a group of insiders leaves early all these time? Why do you love a group that seems to be exploiting you (perhaps only partially, but you’re not getting the deal that some others seem to be)?

This. If people are leaving, a prudent group would try to retain as many as possible, early partnership, bonus, etc. They could not be the best at business, they could be turds, or they don’t want the contract anymore as it’s costing them too much money to make payroll and are trying to keep all the AR for themselves. They may want to just become employees after they lose their contract.

 

[BLADEMDA]

Your w2 job doesn't cover tail insurance (red flag)? Does your W2 job provide good benefits? health care 401k match etc?

The market is great now but may not last forever. What do you risk leaving the w2 job? you could always come back to it. esp if you're never going to make partner. I'd go the 1099 route and get compensated for my time.

If benefits and workload is reasonable for the salary then id keep the w2 job and work extra as 1099 on my vacation.

I work w2 and 1099 and have the best of both worlds. My W2 pays my employer payroll taxes, provides 401k with match, and benefits. my 1099 income is >$300k and I do a full $61k solo 401k. I can buy stethoscopes, books, cme, laptops, cell phone bills, etc and deduct it from my business.

There is a limit to what you the individual can contribute to a 401K. Once the maximum is reach for the individual he/she can't contribute more money. That limit is the same whether you have 1 or 2 plans. But, the EMPLOYER Contribution portion can be made by both the W-2 and the self employed 1099 company.

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[Thepassageofgas]

Why isn’t partnership in the cards for you? Especially if the place is hemorrhaging people and you’re left to pick up the slack? Any why are you working late when a group of insiders leaves early all these time? Why do you love a group that seems to be exploiting you (perhaps only partially, but you’re not getting the deal that some others seem to be)?

I had a very…rough start to my career. Without disclosing too much, since anesthesia is a small world. Boards passed but a lot happened prior (nothing happened to patients, but MY life was kinda a dumpster fire for a while).

Also, not that it matters a ton but I’m a woman, and so far there are no female partners in our group nor have there ever been.

I love this group because prior to this, I was in a group that *actually* treated me like crap, and so I know how bad it can be. And I came from a residency that was really rough, so: from a professional life perspective, this is the best I’ve ever had it. I’m just at a point where my **** is finally together and now I feel like I can actually advocate for myself a little.

Why isn’t partnership in the cards for you? Especially if the place is hemorrhaging people and you’re left to pick up the slack? Any why are you working late when a group of insiders leaves early all these time? Why do you love a group that seems to be exploiting you (perhaps only partially, but you’re not getting the deal that some others seem to be)?

 

[Thepassageofgas]

I think it is not worth it now because of all the irs agents being hired.

This is a POV im hearing a lot. Are you a W2? Partner?

 

[Thepassageofgas]

Exactly. Call once a week, busy ob, late days and only 400? Sounds like it should be at least 50% higher if not double

Wow double 😳 may i ask what region of the country you live in so i might move there 😂😂😂

 

[Thepassageofgas]

Seems to me 1099 comes out as a winner financially, however which job wins the quality of life contest? Sounds like your current employer was happy to keep screwing you over until you put on your walking shoes. More work for the same money (despite inflation) seems to have been the status quo. At least with the 1099 gig you work more you get paid more.

Are you already working with crnas? Do you want to continue working with them? Seems that could be a major factor as well.

My current employer said he doesn’t believe in COL increases because we make so much that inflation shouldn’t be pinching us; we aren’t like techs who have to live paycheck to paycheck and i guess i understand this perspective. But it sure would help since my bills are the same AND i have student loans AND COL, like or not, has increased. 😂😭

I work with CRNAs at both sites. And there are times I do my own cases. In either case, I do most of my own epidurals, spinals, blocks and lines (if bigger case where lines needed) so I’m still getting my hands into stuff.

As far as lifestyle: the nice thing about 1099, at least for me, is that when they ask you to stay late: you’re on the clock. Keep me as late as you wish, the clock keeps ticking. And I keep getting paid. idk.

 

[GassYous]

Wow double 😳 may i ask what region of the country you live in so i might move there 😂😂😂

It isn't the part of the country
Let's say a regular day is worth 2-3k. Busy ob day 4-5k. Once a week. Call day let's say 4-5k. 8 weeks off.

6-800

 

[repititionition]

you’re getting f-ed. don’t let people do it. there is something to be said for getting what you’re worth... even if you pay more of it back in taxes.

 

[kidthor]

I had a very…rough start to my career. Without disclosing too much, since anesthesia is a small world. Boards passed but a lot happened prior (nothing happened to patients, but MY life was kinda a dumpster fire for a while).

Also, not that it matters a ton but I’m a woman, and so far there are no female partners in our group nor have there ever been.

I love this group because prior to this, I was in a group that *actually* treated me like crap, and so I know how bad it can be. And I came from a residency that was really rough, so: from a professional life perspective, this is the best I’ve ever had it. I’m just at a point where my **** is finally together and now I feel like I can actually advocate for myself a little.

Even if you had a rough start, they/you shouldn't be holding that over you - you're board certified and here now and they're short on functional staff... and assuming you're a solid performer, what would all that old stuff matter now?

I think it's very sketchy that there are no female partners. It's hard to imagine there weren't any qualified females in all this time.

Your old group sounds like it was much worse.... but that doesn't mean this group isn't also bad. It's just less bad.

My current employer said he doesn’t believe in COL increases because we make so much that inflation shouldn’t be pinching us; we aren’t like techs who have to live paycheck to paycheck and i guess i understand this perspective. But it sure would help since my bills are the same AND i have student loans AND COL, like or not, has increased. 😂😭

This mindset is more reason you're in a toxic workplace and is contrary to any current market forces. My current academic employer shuffled shells around to make it look like they gave an illusory raise and gave financial constraint explanations with handwaving at least- when they were pushed to give people a raise. Annoying yes, but at least they tried to do something and acknowledged the issue. Your boss seems to have just insulted you while also insulting the integrity of other hospital staff - both are sort of disgusting moves IMO.

I think you are undervaluing yourself (and your market worth). Unfortunately all these toxic actors in medicine gaslight people into self devaluation. If this were me I'd probably eject and find something better unless there's a really good reason to stay.

 

[repititionition]

I just re-read your post. You say you’re with a group you love. Why?

 

[Thepassageofgas]

I just re-read your post. You say you’re with a group you love. Why?

There aren’t many women, but those of us that are here stick together and really help each other out. They’ve been great mentors and make me feel proud of what i’ve achieved and what i do. Now they ask me my opinion (maybe just pretending to make me feel good), it makes me feel like they give a crap.

There aren’t many female surgeons, but the ones that are here give me a supportive eye
roll when I get mansplained in the OR, and we chat about our families and lives.

The OR staff is great, and I have a great relationship with circulators and pre/PACU ladies. Even the labor and delivery
nurses seem glad to see me when I come to troubleshoot an epidural or do a blood patch. So it’s a really pleasant place to go to work, with congenial, familiar conversation, and people actually seem to give a crap about me. It just feels nice. And when things get hairy, it’s nice to have helpful staff that know what I need in a crisis.

Yeah, maybe I’ve worked in some real ****ty places, or maybe I was just a **** doctor and deserved what I got. I know I’m a stronger woman now because of everything I’ve been through (i know, eye roll, but whatever). It’s just that now I want to pay my loans so I can be free of that noose and live my damn life and travel and go to a beach sometime. If it weren’t for the student loans thing, the amount I make is more than enough for a comfortable life (i’m from dirt so i feel very spoiled to make the money i do, usually)


Also I want to say thanks to everyone who replied to a total stranger to help her out.

 

[abolt18]

There aren’t many women, but those of us that are here stick together and really help each other out. They’ve been great mentors and make me feel proud of what i’ve achieved and what i do. Now they ask me my opinion (maybe just pretending to make me feel good), it makes me feel like they give a crap.

There aren’t many female surgeons, but the ones that are here give me a supportive eye
roll when I get mansplained in the OR, and we chat about our families and lives.

The OR staff is great, and I have a great relationship with circulators and pre/PACU ladies. Even the labor and delivery
nurses seem glad to see me when I come to troubleshoot an epidural or do a blood patch. So it’s a really pleasant place to go to work, with congenial, familiar conversation, and people actually seem to give a crap about me. It just feels nice. And when things get hairy, it’s nice to have helpful staff that know what I need in a crisis.

Yeah, maybe I’ve worked in some real ****ty places, or maybe I was just a **** doctor and deserved what I got. I know I’m a stronger woman now because of everything I’ve been through (i know, eye roll, but whatever). It’s just that now I want to pay my loans so I can be free of that noose and live my damn life and travel and go to a beach sometime. If it weren’t for the student loans thing, the amount I make is more than enough for a comfortable life (i’m from dirt so i feel very spoiled to make the money i do, usually)


Also I want to say thanks to everyone who replied to a total stranger to help her out.

Doesn't hurt to get a few job offers so you can go to your employer and ask for more money. You tell them "I love it here. I'd love to stay here. But you're not paying me what I'm worth. These are the offers I have. Can you match them?"

Then, I think you need to be willing to walk if they won't work with you in a substantial way.

 

[kidthor]

Yeah, maybe I’ve worked in some real ****ty places, or maybe I was just a **** doctor and deserved what I got.

If you’re a board certified anesthesiologist then don’t give any thought to whatever illusory past you have.

I’ve crossed paths with too many odd birds who can’t even get board certified….

Don’t sell yourself short!