Low Taxes Are Paid By Agency-Employed Consultants
Doesn’t “low taxes!” grab your attention? American workers are subject to two types taxes - one of them is federal income tax and the other is F.I.C.A.
Federal Income Tax
This tax applies to everyone, regardless of whether it is being withheld by the employer or not. It is paid annually. Simply put, independent consultants who work for themselves and who file I.R.S Form-1099 are all subject to the same tax bracket as their W-2 consultant counterparts. Independent consultants have to save enough around the year to cover their annual Federal Income tax bills. Sometimes independent consultants also have to pay State and local income taxes, as these taxes are applicable in many states.
Independent consultants, as well as agency consultants, pay the same amount of Federal Income Tax if their gross yearly earnings are the same, but it is paid differently.
F.I.C.A
This tax is mainly paid each period to fund Social Security and Medicare - it is applicable to all workers. The rate on this tax is 15.3%.
Agency employed consultants pay 7.65% of their taxable income, whereas independent consultants pay twice that amount. This means that an independent consultant pays an additional $4,000 […]

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